Combining bottom-up and top-down investing in a carefully coordinated way will yield the strongest stocks in the most compelling industries.
For instance, in the energy industry, I can make a very good case today for the oilfield service companies, and in that group, I am positive about the second-largest player, Halliburton (NYSE: HAL).
CEO Dave Lesar recognizes that his sector is changing rapidly, and so he's reshaping his company accordingly. For instance, Thursday's announcement of several executive changes seems to be part of a strategy with pragmatism and flexibility at its core.
One switch in particular reassigns the company's CFO, Cris Gaut, to be president of one of two operating units, Halliburton Drilling and Evaluation. I knew Cris when, as a dart-throwing-style sort of analyst, I followed offshore driller ENSCO (NYSE: ESV), when he was its CFO and later co-COO. He's bright and dedicated, but in addition, I like the idea of positioning capable financial people in operations.
Beyond that, Lesar has made several other canny moves of late. For instance, he decided earlier this year to open a headquarters in Dubai, the epicenter of energy in the eastern hemisphere that is fast becoming Houston's alter ego. And that hemisphere is fast dwarfing its western sibling as the place for action in energy.
There are also some attractive metrics for the company. Looking at just a couple of basic numbers only intensifies my interest in Halliburton. The company trades at something of a forward P/E discount to its solid Houston neighbor Baker Hughes (NYSE: BHI) -- despite carrying a return on equity percentage half again higher than Baker's -- and at a much bigger discount to industry giant Schlumberger (NYSE: SLB).
So even though crude prices could easily retreat in the short term, possibly resulting in a sympathy pullback for the oilfield services players, I'd urge Fools to look to Halliburton as an intermediate- and long-term play with lots of upside potential.
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