CRC’s 11% Drop, But a Fund Bets Big

Denver’s Sourcerock Group, ever the contrarian, decided to throw $77.77 million at California Resources Corporation (CRC) in Q3. Because nothing says “I’ve got this together” like buying a stock that’s down 11% over a year. Classic.

What Happened

Sourcerock, in a move that screams “I’ve seen the future and it’s a spreadsheet,” added 1.18 million shares of CRC, bringing their total stake to 3.18 million. Now, their position is worth $169.14 million. Because if you’re going to lose money, you might as well do it in bulk.

What Else to Know

Sourcerock’s CRC bet now makes up 11.5% of their 13F portfolio. Which is like saying, “I’m 11.5% committed to this disaster.” Their top holdings? AR, NE, TALO, CHRD-because why not spread the misery?

NYSE: AR: $261.30 million (17.77% of AUM)
NYSE: CRC: $169.14 million (11.5% of AUM)
NYSE: NE: $120.27 million (8.18% of AUM)
NYSE: TALO: $102.63 million (6.98% of AUM)
NASDAQ: CHRD: $93.67 million (6.37% of AUM)

CRC’s stock is at $44.60. Down 11% year-over-year. Meanwhile, the S&P 500 is up 15.5%. Because apparently, some markets have rules and others don’t.

Company Overview

Metric	Value
Revenue (TTM)	$3.51 billion
Net Income (TTM)	$384.00 million
Dividend Yield	3.7%
Price (as of Monday)	$44.60

Company Snapshot

CRC’s a oil-and-gas company with a side hustle in electricity. Because why not? If you’re going to be a multi-hyphenate, make it a hyphenated energy company.
They’ve got an “integrated model.” Which is just a fancy way of saying, “We do everything from drilling to selling, so we can charge extra at every step.”
They serve California refineries. Because nothing says “local” like selling oil to the same people who complain about gas prices.

CRC’s a big deal in California. They’re like the local gym that’s always closed but somehow still has a waiting list. The company’s got scale, infrastructure, and a dividend yield that’s higher than your average avocado toast. But let’s be real-this is a stock that’s either going to boom or bust, and the only thing more predictable than that is the S&P 500’s grin.

Foolish Take

Sourcerock’s $169 million bet on CRC is like buying a used car from a guy who says, “It’s not broken, I just haven’t fixed it yet.” The company’s cash flow is solid-$279 million operating, $188 million free. But let’s not pretend this isn’t a high-risk, high-reward play. The dividend’s up 5%, and they’ve retired some debt. But here’s the kicker: they’re still a commodity play. And commodities? They’re like your ex-they come with drama and no guarantees.

Management’s all, “We’re resilient!” But resilience doesn’t mean much when oil prices are stuck in neutral. This isn’t a growth story; it’s a “we’ll survive the storm” story. And if the storm comes early? Well, that’s on you.

Glossary

Stake: Like a bet, but with more paperwork and fewer chances to win.
13F reportable assets: The SEC’s version of a “show me your cards” moment.
Assets under management (AUM): The total value of all the things someone else is managing, which is probably more than you think.
Portfolio: A collection of investments that’s either a masterpiece or a mess.
Dividend yield: The percentage of your investment that’s paid back in cash, usually with a side of “hope this lasts.”
Trailing twelve months (TTM): A fancy way of saying “the last 12 months, not including the ones we’re currently in.”
Net position change: The difference between what you had and what you have now. Usually, it’s a loss.
Integrated model: When a company does everything in-house, because they’re too proud to outsource.
Mineral acres: Land that’s more valuable than your childhood home.
Commodity sales: Selling raw materials, which is just a fancy way of saying “we’re not adding value, just moving it.”
Electricity generation: Making power so you can sell it to the grid. Because why not?
Regulatory dynamics: The rules that change every time you think you’ve figured it out.

🚀

2025-12-29 22:52