greenwave3 (66.22)

Do you have gas?

August 26, 2008 – Comments (0) | RELATED TICKERS: TGS

Natural gas, that is.

A very interesting stock recently caught my attention, Transportadora de Gas del Sur S.A (TGS). These guys have been so stealthy that few people have even noticed them. Let's call these guys 'silent but deadly'.

TGS operates the largest natural gas pipeline in South America, which primarily runs through Argentina, but delivers gas throughout the continent. Argentina has a large deposit of natural gas, and through the TGS pipeline, that natural gas is shipped around the continent.  Natural gas distribution is as close to a consumer staple as you're going to find, which would make even Warren Buffett happy.

Are you a value investor? A growth investor? Can't make up your mind? Either way, TGS has you covered. TGS is a strong company with a great balance sheet, strong free cash flow, and positive EPS growth.

The current market price also offers a strong margin of safety. In the past several months, TGS has been beaten down to the point that it's valuation is looking just plain silly. For every dollar you invest, you are getting $1.60 worth of equity in this company, along with a negative PEG. Forget about cheap growth. This is growth that is paying you just to hop along for a ride.