Onshore Drillers Bullish Outlook

Dan Steffens  |

The ongoing volatility in the stock market is affording investors with an opportunity to invest in high quality oil & gas producers and oilfield service companies at a deep discount to their asset value. In particular, junior and mid-cap companies at trading at extremely attractive valuations.

In my opinion, equities are pricing in much lower oil prices over the long-term. My view is that while there may be additional volatility in the crude oil price in the short-term, supply and demand fundamentals are very strong for oil and long-term pricing will remain high and equity prices will rise to correct this disconnect.

EPG has just completed a company profile for Union Drilling (UDRL) has been posted under our Watch List Tab.

We have been tracking UDRL on our Watch List for almost a year. The company's 3rd quarter results beat our forecast. We are bullish on the onshore drillers as we see continued strong demand for high quality onshore drilling equipment in the North American market, driven primarily by expanding drilling budgets in the shale plays.

At Energy Prospectus, we are focused on finding small and mid-cap energy firms that have significant near-term production growth and catalysts that will draw the market’s attention. Our current recommendation is that investors stay heavily weighted to crude oil, although we do see long-term potential for natural gas.

Author note: Company profiles are available to EPG members only but readers that would like to receive a free copy can contact Dan at dmsteffens@comcast.net.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
REE Rare Element Resources n/a n/a n/a n/a
AYI Acuity Brands Inc. 121.57 -3.98 -3.17 256,277 Trade
ORCL Oracle Corporation 51.58 -1.61 -3.03 11,374,639 Trade
GLW Corning Incorporated 27.45 -0.73 -2.59 5,438,688 Trade
GEN Genesis Healthcare Inc. 1.00 -0.00 -0.18 196,621 Trade
FTR Frontier Communications Corporation 0.74 -0.09 -10.85 1,631,474 Trade
ECT ECA Marcellus Trust I of Beneficial Interest 1.12 -0.16 -12.37 146,226 Trade
PG Procter & Gamble Company (The) 117.32 -2.10 -1.76 7,336,907 Trade
GE General Electric Company 7.97 -0.22 -2.69 128,643,149 Trade
TXT.PR.A:CA Top 10 Split Trust Preferred Securities 12.51 0.01 0.08 500
FOSL Fossil Group Inc. 10.40 -0.15 -1.42 1,673,238 Trade
AA Alcoa Corporation 17.48 -0.57 -3.16 3,236,669 Trade
CSX CSX Corporation 64.62 -1.52 -2.30 5,330,550 Trade
TRV The Travelers Companies Inc. 144.73 -3.08 -2.08 1,430,533 Trade
MO Altria Group Inc. 46.41 -0.18 -0.39 10,741,849 Trade
BONT Bankers Petroleum Ltd. n/a n/a n/a n/a
S Sprint Corporation 6.74 -0.13 -1.89 7,355,710 Trade
PPL PPL Corporation 29.45 -0.37 -1.24 3,877,650 Trade
AKAM Akamai Technologies Inc. 86.99 -1.73 -1.95 1,239,091 Trade
MET MetLife Inc. 44.59 -1.62 -3.51 8,939,274 Trade
VOD Vodafone Group Plc 18.29 -0.06 -0.33 2,970,229 Trade
TJX TJX Companies Inc. (The) 53.09 -1.79 -3.26 9,039,346 Trade
SCCO Southern Copper Corporation 29.55 -0.62 -2.06 872,797 Trade
AES The AES Corporation 14.79 -0.41 -2.70 3,941,331 Trade
JBLU JetBlue Airways Corporation 17.22 -0.79 -4.39 4,094,724 Trade
COST Costco Wholesale Corporation 274.01 -5.91 -2.11 1,984,929 Trade
VZ Verizon Communications Inc. 55.92 -0.86 -1.51 13,203,639 Trade
GMCR Keurig Green Mountain Inc n/a n/a n/a 0 Trade
VRSN VeriSign Inc. 200.52 -4.68 -2.28 517,993 Trade
GM General Motors Company 36.06 -1.20 -3.22 7,834,868 Trade
RBS Royal Bank of Scotland Group Plc New (The) ADS 4.47 -0.07 -1.54 804,979 Trade
GOOG Alphabet Inc. 1,151.29 -38.24 -3.21 1,688,271 Trade
BMY Bristol-Myers Squibb Company 46.58 -1.28 -2.67 16,321,221 Trade
TTM Tata Motors Ltd Limited 7.72 0.11 1.45 2,855,105 Trade
UNM Unum Group 26.11 -0.64 -2.39 3,942,010 Trade
EE El Pasoectric Company 66.05 -0.36 -0.54 321,108 Trade
ACHN Achillion Pharmaceuticals Inc. 4.26 -0.31 -6.78 1,711,399 Trade
HIG Hartford Financial Services Group Inc. (The) 58.10 -1.38 -2.32 1,856,634 Trade
F Ford Motor Company 8.77 -0.27 -2.99 44,987,686 Trade
AZN Astrazeneca PLC 44.58 -0.83 -1.83 3,759,998 Trade
NFLX Netflix Inc. 291.44 -5.49 -1.85 6,331,189 Trade
MRK Merck & Company Inc. (new) 84.94 -1.78 -2.05 10,122,859 Trade
ANF Abercrombie & Fitch Company 16.43 -0.57 -3.35 2,937,527 Trade
SUN Sunoco LP representing limited partner interests 30.86 -0.14 -0.45 396,700 Trade
IHG Intercontinental Hotels Group American Depositary Shares (Each representing one) 62.77 -0.72 -1.13 83,751 Trade
BRCM Broadcom Corp. n/a n/a n/a 0 Trade
EXC Exelon Corporation 44.88 -0.64 -1.41 6,977,954 Trade
T AT&T Inc. 34.82 -0.57 -1.61 33,864,032 Trade
DUK Duke Energy Corporation (Holding Company) 90.74 -0.58 -0.64 3,153,865 Trade
THRX Theravance Inc n/a n/a n/a 0
RL Ralph Lauren Corporation 83.91 -3.99 -4.54 1,453,581 Trade
CMCSA Comcast Corporation Class A Common Stock 42.43 -1.34 -3.06 18,196,656 Trade

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