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Money Morning's "unloved" pick of the week is oil services company Halliburton Co. (NYSE: HAL).
An unloved investment is one that's been beaten down – but is actually a great value. Investors then get an amazing entry point into a good long-term investment.
Halliburton was recently singled out by Money Morning Chief Investment Strategist Keith Fitz-Gerald, a seasoned market analyst with 33 years of experience.
Halliburton Co. (NYSE: HAL): About the Company
Halliburton was founded in 1919 in Oklahoma by Erle P. Halliburton, who borrowed a wagon, a team of mules, and a pump to start his oil-well cementing business. Now based in Houston, Texas, Halliburton is the world's second-largest oil field services company. With operations in approximately 80 countries, HAL sells labor services and drilling equipment to the oil and natural gas industries. Halliburton has a market cap of $45.5 billion and employs about 80,000 people. The Chief Executive Officer is David J. Lesar. And yes, former Vice President Dick Cheney once served as Halliburton's CEO.
Halliburton Co. (NYSE: HAL): Why It's Unloved Right Now
HAL stock fell by 35% from July 23, when it hit a 52-week high of $74.33, dropping as low as $48.17 on Oct. 15. It has only slightly recovered since, trading at just under $55.
The main reason for the plunge of Halliburton stock is the dramatic fall in oil prices. The price of oil nosedived from over $100 a barrel at the start of July to below $85 in October. Oil has continued to slide in November down to about $75.
Cheaper oil means less profit for the oil producers and less money to spend on Halliburton's products and services. The glum short-term oil price outlook has scared investors away from the entire sector.
"Many great companies related to energy have gotten slammed in a classic 'guilt by association' move," explained Fitz-Gerald.
About the Author
Dave has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.