Russian Energy and Dividend Opportunities: Gazprom for Natural Gas, Lukoil for Oil
Kurt Wulff (McDep Associates) submits: Contrarian Buy-recommendations Gazprom (OGZPY.PK) and Lukoil (LUKOY) offer a repeat of the high rate of appreciation demonstrated in the 2000s along with the volatility demonstrated during the global financial panic of 2008. The companies’ home country, Russia, may deliver the higher growth of an emerging market economy without the higher debt of developed countries. Politically, the more traditional Prime Minister Putin has restored stability while the new generation President Medvedev strives to apply best practices to create greater prosperity and individual freedom. Despite full progress being years away, the main consideration for investors is that the trend continues positively.The prospective payoff is more than 100% as measured by McDep Ratios for Gazprom and Lukoil at 0.39 and 0.43 respectively. First quarter results reported by Gazprom on September 3 and second quarter results reported by Lukoil on August 27 met or exceeded expectations. Prospective cash flow and long reserve life support estimated Net Present Value (NPV) of $64 a share for Gazprom, concentrated 81% on natural gas and $135 for Lukoil, concentrated 99% on oil.Complete Story »
- Original article
- Login or register to post comments
