What Investors Should Be Watching at National Oilwell Varco

In the following video, Fool analysts Jim Mueller and Austin Smith talk about what investors in National Oilwell Varco should be looking for.

With companies like NOV, which has very broad exposure to the energy sector, it can be difficult for investors to know what they should focus on. Jim, however, sees three key areas for NOV.

The first is the price of oil. As oil prices rise, the Big Oil companies want to drill more wells, increasing business for NOV. But when prices fall, the opposite happens and demand for NOV's products shrinks.

The second is NOV's backlog. Right now, NOV has a backlog of orders to execute worth about one year's revenue. Investors want to see that backlog growing or holding steady.

The last area is growth in non-fossil-fuel energy. Fossil fuels are not environmentally friendly, and the move toward wind, solar, and electric vehicles will cut into the demand for oil long-term

Although it has its risks, National Oilwell Varco is perhaps the safest investment in the energy sector because of its industry-leading 60% market share. This company is poised to profit in a big way; its customers are both increasing the number of new drilling rigs and updating an aging fleet of offshore rigs. To help determine whether NOV is a nice fit for your portfolio, check out our premium research report with in-depth analysis on whether it's a buy today. For instant access to this valuable investor's resource, simply click here now and claim your copy today.


Read/Post Comments (0) | Recommend This Article (1)

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: 2167223, ~/Articles/ArticleHandler.aspx, 12/19/2014 7:19:38 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