Why Denbury Remains a Buy

The following video is part of our “Motley Fool Conversations” series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.

Denbury CEO Phil Rykhoek recently outlined the oil company’s current and future plans. And John and David believe the stock is still a buy after considering those plans. Denbury is the second largest tertiary recovery oil company behind Occidental Petroleum. It floods older oil fields with CO2 to extract oil left behind. It’s a great business model, as long as you own massive quantities of CO2, like Denbury does. The company also owns property in the Bakken. Unlike big Bakken players such as Continental and EOG Resources, Denbury is using those cash flows to fund its future tertiary production growth in the Rockies. Denbury is a great selection for John and David’s real-money portfolio. It’s domestically focused, has a differentiated position, and can grow for years. And the best part is, investors can pick up shares cheaply today.

There are many different ways to play the energy sector, and our analysts have uncovered an under-the-radar company that's dominating its industry. This company is a leading provider of equipment and components used in  drilling and production operations, and poised to profit from it in a big way. To get the name and detailed analysis of this company that will prosper for years to come, check out our special free report: "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this under-the-radar company before the market does. Click here to access your report -- it's totally free.

David Meier has no positions in the stocks mentioned above. John Reeves has no positions in the stocks mentioned above. The Motley Fool owns shares of Denbury Resources and ExxonMobil. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2009938, ~/Articles/ArticleHandler.aspx, 8/30/2014 10:41:41 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement