This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Glencore: The Next Goldman Sachs

And despite Goldman's call, many analysts remain bullish.

Fadel Gheit, analyst at Oppenheimer & Co. who follows oil and gas companies like Exxon Mobil (XOM - Get Report), Chevron Corp. (CVX) and ConocoPhillips (COP) expects oil prices to remain inflated due to political turmoil in the Middle East while natural gas remains cheap since technology developments have made it easier to find.

It may not matter much to Glencore--or, for that matter, to Goldman, which is a formidable commodities trader itself. Goldman's top two executives, Chairman and CEO Lloyd Blankfein and President Gary Cohn, came up through the firm's commodities division.

"Traders do not want prices to be stale," Gheit says. "Whether [oil is] $100 [per barrel] or $50 or $200 they want them to keep moving. Up or down doesn't matter if they just keep moving, because when they move, that's how they make their money."

Also, as Gheit points out, commodities in recent years have come to occupy an increasingly central role in the financial services industry--further reason for investors to keep an eye on Glencore.

"Ten years ago a pension fund never touched a commodity, but now it's an asset class. That's why they have ETFs. It's packaged if you will. The banks are trying to create another product to create customers, and that's what they're doing."

No one is talking about Glencore and ETFs in the same breath yet, but once it goes public such discussions may not seem so far-fetched. Among the shareholders getting in on the ground floor will be Fidelity Investments and BlackRock (BLK). both of which participated in the commodities giant's 2009 $2.2 billion convertible bond offering.

-- Written by Dan Freed in New York.
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
3 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
C $54.21 0.00%
CS $22.00 0.00%
GS $190.47 0.00%
JPM $67.17 0.00%
MS $33.78 0.00%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs