National Oilwell Varco Inc (NYSE:NOV)

CAPS Rating: 5 out of 5

The Company is a worldwide provider of equipment and components used in oil and gas drilling and production operations, oilfield services, and supply chain integration services to the upstream oil and gas industry.


Player Avatar compustat (< 20) Submitted: 3/15/2013 8:01:38 PM : Outperform Start Price: $46.76 NOV Score: +9.59

This is my top stock pick for the next five years. This company is positioned perfectly to capitalize on several major industry trends. First, NOV is absolutely the best and, in many cases, only source of equipment for E&P companies looking to utilize more complex drilling techniques. Eventually, this will be all companies. Secondly, the company's products dominate both onshore and offshore drilling markets, and will continue to do so in the future.

So why is this stock so undervalued?

Because the oil industry as a whole has been looked upon poorly due to recent incidents (e.g. BP spill) and unfavorable market prices (until lately).

What does this mean for investors?

It means now is the time to buy while the stock is still beaten down. Enjoy a 3-5 year price appreciation up to around $100 per share (unless competitive position strengthens, in which case you would continue on).


- Wide economic moat

- Substantial forward looking prospects combined with great historical profitability and operating results

- Excellent management

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