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Energy Company Presentation

Energy Company Presentation. Dan Geisler Olga Boder ( Firdman ) Fall 2009. Agenda. Recommendation Recap of Sector Presentation Business analysis Financial analysis &Valuation RIG NOV COP BP Revisit Recommendation. Recommendation. Hold the overall % for the sector.

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Energy Company Presentation

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  1. Energy Company Presentation Dan Geisler Olga Boder(Firdman) Fall 2009

  2. Agenda • Recommendation • Recap of Sector Presentation • Business analysis • Financial analysis &Valuation • RIG • NOV • COP • BP • Revisit Recommendation

  3. Recommendation Hold the overall % for the sector. Hold Transocean Ltd. Reduce the % of BP plc. – ADR and ConocoPhillips Co. Diversify our energy sector by purchasing a stock with an exposure to other industries inside the energy sector. Purchase National Oilwell Varco (NOV).

  4. SIM and S&P 500 SIM Companies and Industries

  5. Oil Price Forecast

  6. Industry/Sector Valuations

  7. Industry/Sector Valuations

  8. Industry/Sector Valuations

  9. Transocean Ltd. (RIG) Oil & Gas Drilling & Exploration Industry (correlation: 0.91) Provides contract drilling services for offshore oil drilling Their competitive advantage and source of high margin profits is due to a specialization in harsh environment and deepwater drilling Deepwater Millennium has set four world water-depth records in the U.S. Gulf of Mexico, including the most recent record at 8,960 feet of water Has well depth record of over 40,000 feet (7.5 miles)

  10. Transocean (RIG) Key Facts/Figures 2008 Total revenue: $12,764m 2008 Net income: $4,202m (33.2%) 9 month profit margin: 27.8% Current stock price (11/20/09): $83.80 Current market cap (11/20/09): $26.91b Correlation to crude oil: 0.92 Headquartered: Vernier, Switzerland

  11. Transocean (RIG) Valuation Ratios

  12. National Oilwell Varco (NOV) Oil & Gas Equipment & Services Industry (correlation: 0.91) Design, construct, manufacture, and sell systems, components, and products used in oil and gas drilling and production Business segments: Rig Technology, Petroleum Services & Supplies, and Distribution Services

  13. National Oilwell Varco (NOV)Key Facts/Figures 2008 Total revenue: $13,431m 2008 Net income: $1,952m (14.5%) 9 month profit margin: 11.3% Current stock price (11/20/09): $42.79 Current market cap (11/20/09): $17.9b Correlation to crude oil: 0.94 Headquartered: Houston, Texas

  14. National Oilwell Varco (NOV)Valuation Ratios

  15. ConocoPhillips Co. (COP) • Integrated Oil & Gas Industry • One of the largest integrated energy company in the world that engages in the exploration, production, refining, processing, and marketing of petroleum and natural gas. • Lines of Business: • Exploration and Production • Midstream • Refining and Marketing • LUKOIL Investment • Chemicals • Emerging Businesses

  16. ConocoPhillips Co. (COP) Key Facts/Figures • 2008 Total revenue: $240,842m • 2008 Net income: ($16,998)m (-7.1%) • 9 month profit margin: 3.4% • Current stock price (11/20/09): $52.08 • Current market cap (11/20/09): $77.27b • Correlation to oil: 0.91 • Headquartered: Houston , Texas

  17. ConocoPhillips Co. (COP)Valuation Ratios

  18. BP PLC(BP) • Integrated Oil & Gas Industry • The 3rd largest global energy company and the 5th largest company in the world. BP supplies fuel for transportation, energy for heat and light, retail services, and petrochemicals products. • Lines of Business: • Exploration and Production • Refining and Marketing • Other Businesses and Corporate

  19. BP PLC (BP) Key Facts/Figures • 2008 Total revenue: $ 367,053m • 2008 Net income: $ 21,157 m (5.7%) • 9 month profit margin: 7.2% • Current stock price (11/20/09): $ 57.83 • Current market cap (11/20/09): $180.62b • Correlation to oil: 0.67 • Headquartered: London, England

  20. BP PLC (BP) Valuation Ratios

  21. Recommendation

  22. Questions?

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