Discussion in 'Stocks' started by Daal, Oct 7, 2008.
Practically any E&P company, unless you believe oil is going back to $20.
Large retained earnings and low cost producer.
while ECA DE AND BNI remain top picks but if you want to play India and mddleeast infrastructure plays RS MT --others prolly know more in infrastructure sector(if you do please post)seem very attractive at these levels. Will buy the day market sells off less than 5% ( that seems like a novelty these days)
PCZ is my third pick I guess. trading at 3x peak earnings. Its a oil producer and refiner in Canada, they got reserves in the tar sands and seem that will expand there. If I'm right that oil will go to $200 this stock will explode
CHK is so freaking leveraged up it's scary. I'd much rather go with an APA or a DVN which is no where near the debt/equity ratio of CHK. Do your homework!
PTEN is an interesting play down here.
Nearly 5% dividend yield and NO DEBT. If nat-gas drilling day rates come under pressure from a cut in E&P capital drilling budgets, they will simply stack rigs.
LLL has cash flow north of $1.1 Billion and is back to the July lows before a 20 point rally up to $106. A superbly managed company. electronics defense. Not a "prime" contractor. Owned it since 1998.
Stay away from leverage in this environment. It's killing not only people, but companies!
FCX- great div and gold and copper are not going anywhere.
PBR- when we finally pull out of this ressession oil will be on the up again.
WMT- Bad times but ppl still need to live and bargin shop is what they will do.
yeah this is a nice one it is a such a fkin laggard that even if u miss a huge upday in oil and oil producer stocks this one will not move as much or as fast as others so you have plenty of time to get in and same goes for downside it takes a while for this stock to turnaround and go back down.
price = $2/share
book value = $2/share
This is an oil company that got clobbered recently because they had most of their oil hedged for the next 6 months at "only" 80 dollars a share. Forward P/E is stupidly low. They also have multiple exploration sites, and if one of them turns up something, they get to print more money. (Must be nice to be in the oil business huh.)
CHK has 54% debt to cap ratio, which is high for larger cap E&P names, but very manageable. Earliest LT debt is not due until 2013. It has roughly 2.5 the total debt and debt/cap of APA or DVN.
CHK is heavily hedged at much higher prices, so it can handle more leverage than unhedged companies. It's cash flow is far less sensitive to decline in oil/gas prices. It is also growing cash flow at close to double what APA or DVN can do.
Most of CHK properties are in continental US. APA and DVN are global players, adding an element of risk.
I think all three are good choices for someone with the ability to ride the market out. They have assets in the ground that are highly likely to increase in value.
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