Halliburton Is a Bargain So You'd Better Buy Now

NEW YORK (TheStreet) -- Despite what seems like a never ending series of geopolitical hazards, Halliburton (HAL) is working to expand its margins and make the company more attractive to investors.

Here's one reason for investing: At around $67.50, shares are up nearly 33% for the year to date.  Back in November I told you Halliburton (HAL) was heading to $65 per share. History may be repeating itself.

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But let's understand what we're getting into here. Halliburton has to content with some slippery geopolitical issues. Halliburton management has acknowledged delays in getting government approvals for contracts. If issues in Iraq and Russia/Ukraine escalate, the company could experience more delays with critical projects. To some extent, these risks reflect the 9% decline in the share price since Halliburton shares reached a 52-week high of $74.33 in July.

Of course, these risks also exist for rivals Schlumberger (SLB) and Baker Hughes (BHI) . However, Halliburton has strong growth opportunities in North America.

Halliburton is also growing its capabilities in deepwater and mature fields, which, I believe, will help spur long-term double-digit earnings growth over the next three to five years. Management expects to see 11% compounded annual growth in the deepwater well service market by 2020. This is a market that is expected to grow towards $100 billion in the next six years.

The stock, which is trading at a P/E of 21, is cheap. Baker Hughes, which I happen to like, carries a P/E of 26. Based on 2015 earnings estimates of $5.33, according to Yahoo! Finance, Halliburton is one of the best bargains in the energy sector. So with the stock trading at around $67 per share, Halliburton should reach $80 in the next 12 to 18 months.

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