In my Feb. 20 column, I called Halliburton (HAL) - Get Halliburton Company Report "the premier energy company in the world," and the option I chose hit its good-till-canceled (GTC) sell price within three days.
Today I'm hoping to repeat that performance.
Halliburton had a record year in 2006, with revenue topping $22.50 billion, and at its Wednesday close of $32.36 the stock's price/earnings to growth ratio is 0.81 and its P/E ratio is 14.5.
When I invest my money in a stock, I like to know the strengths and weaknesses of the company, as well as who else is invested in the stock.
provides excellent resources for researching this facet of a company, and through Stockpickr I learned that George Soros, the man who made billions on currency speculation, has invested a portion of his multibillion-dollar fortune in the company. Soros' portfolio is one of the 10 most-viewed portfolios on Stockpickr for a reason, and his investment in Halliburton makes me increasingly optimistic about Halliburton's fortunes.
Since I last traded Halliburton, the company has completed its spinoff of
, which led Standard & Poor's to raise Halliburton's credit rating.
In addition, Halliburton announced it will relocate its corporate headquarters to the Dubai, a move intended to expand its business operations beyond North America. In 2006, the energy services group of Halliburton earned over half of its revenue in North America. However, moving its headquarters to the Middle East puts Halliburton at the center of the world's oil supply and in a more opportune arena to grow its profit.
Furthermore, Halliburton remains in the midst of the $2 billion share-repurchase program announced last September.
Yesterday, in my column on
, I pointed out the value of its share-buyback program, but Komag's buyback is only one-tenth the size of Halliburton's.
Halliburton's shares are 23% off the 52-week high, and the company itself will provide a ready buyer of shares, so I like this setup. To capitalize on Halliburton using deep-in-the-money calls, I will place a limit order to buy 10 October 27.50 calls (HALJR) at $5.90, or better.
Game of Life
Despite ongoing frigid temperatures in the East, accompanied by an inordinate number of postponements, the baseball season continues to move forward.
The Braves and Mets are both playing well as they sit atop the NL East. The Dodgers lead the NL West, with the Diamondbacks and Padres right on their heels. In the NL Central, all six teams are hovering around .500. The AL East finds the Blue Jays and Red Sox on top, while the Tigers, Indians and Twins jockey for first in the AL Central. The Mariners are the only team with a winning record in the AL West, although they have played five fewer games than their fellow competitors.
From an individual perspective, Mark Buehrle pitched a no-hitter last night for the Chicago White Sox against the Texas Rangers. A-Rod continues to excel, hitting his ninth home run last night, and David Wright extended his hitting streak to 25 games over two seasons, thereby becoming the first player since Curt Flood and Dick Groat to begin a new year with a double-digit hit streak after concluding the previous season with at least a 10-game hit streak.
Dice-K's record fell to 1-2 Tuesday, with a loss to Toronto, despite yielding only two runs and striking out 10 Blue Jays in only six innings of work. Nonetheless, his ERA of 2.70 is respectable.
Speaking of individual accomplishments, and respectability, Colt Molloy, a senior left hander for Memphis High in Texas, began this season with five consecutive no-hitters, one short of the national high school record. Heretofore, Molloy had only generated interest from a few junior colleges. After his auspicious start this year, the school's athletic director recently informed Molloy of a call he received from a New York Yankees scout, inquiring about the pitcher.
Rivaling Molloy's start, albeit in a different sport and on a professional level, was the NHL playoff debut of Roberto Luongo, the goalie for the Vancouver Canucks. Luongo merely had 72 saves in the Canucks' 5-4 quadruple-overtime victory over the Dallas Stars on April 11, 2007. In a game that lasted 138 minutes and 6 seconds, Luongo's 72 saves established an NHL record for a goalie in his initial start in the playoffs.
Two other individual accomplishments are worth mentioning. Kobe Bryant has scored 50 or more points in 10 games this year, the most by an NBA player since the incomparable Wilt Chamberlain did it 30 times in 1962-63, a season in which The Dipper averaged 50 points per game. Robert Cheruiyot of Kenya became only the eighth man in history to win the Boston Marathon at least three times with his victory on Monday, April 16, 2007.
Undoubtedly, the weather conditions, with a wintry mix of precipitation, wind chills in the 20s, and wind gusts in excess of 50 mph gave new meaning to the name Heartbreak Hill. Certainly, the weather conditions were somewhat different from those encountered by Cheruiyot during his usual training regimen in Kenya.
Lastly, I would be remiss if I did not acknowledge the senseless killing of 33 people at Virginia Tech University in Blacksburg, Va., on April 16. My heart and prayers go out to the families of the victims, the student body of Virginia Tech, and the Virginia Tech community. Inexplicable events such as this give all of us reason to pause and recognize the fragility and tenuousness of life.
Always remember: Life is a journey; enjoy the ride!
At the time of publication, Dykstra was long HAL, KOMG.
Nicknamed "Nails" for his tough style of play during his Major League Baseball career, Lenny Dykstra was an integral member of the powerful Mets of the mid-1980s, including the world champion 1986 squad, and the Phillies in the early 1990s.
Today, Dykstra manages his own stock portfolio and serves as president of several of his privately held companies, including car washes; a partnership with Castrol in "Team Dykstra" Quick Lube Centers; a state-of-the-art ConocoPhillips fueling facility; a real estate development company; and a new venture to develop several "I Sold It on eBay" stores throughout high-demographic areas of Southern California.