You’ll receive the new Investment Digest issue this afternoon. But first, one more Daily Alert. Today’s recommendation is another bargain buy, this time from John Buckingham’s The Prudent Speculator.
“Canada-based Nexen, Inc. (NXY) engages in global exploration and production of conventional oil in the Gulf of Mexico, Nigeria and the North Sea, and unconventional natural gas in British Columbia, as well as mining oil sands in Alberta. We believe increases in long-term global oil demand and tightening supply constraints should bode well for Nexen and the E&P industry.
“We also like that Nexen continues to maintain its status as a low-cost producer, while the diversity of its portfolio potentially reduces risk and management continues to pay down debt to strengthen the balance sheet (with long-term debt down more than 36% since the beginning of 2009).
“We believe NXY is cheap, as the stock currently trades for less than 9 times forward earnings estimates, below book value and with an Enterprise-Value-to-EBIDTA ratio of 3.”
- John Buckingham, The Prudent Speculator, June 3, 2012