Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

3 Can’t-Miss Quotes for Energy Investors This Earnings Season: Baker Hughes Incorporated (BHI), Continental Resources, Inc. (CLR)

Page 1 of 2

You can learn a lot from a company’s quarterly conference call if you listen carefully. Sometimes you can catch a glimpse of a future industry trend that you might have otherwise overlooked. This can give you an upper hand in choosing where to plunk down your investing dollars.

So far this earnings season energy investors have been treated to some very solid reports along with an overall positive future outlook. However, hidden in plain sight are comments which foretell trends that you don’t want to miss. Let’s take a look at three of my favorites and what they mean for investors.

Baker Hughes Incorporated (NYSE:BHI)The rails are making a difference in the Bakken
As I’m sure you’ve heard, crude oil shipments by rail were up huge last year. Overall shipments rose 46.3% over 2011. While this has been good to the bottom line of the rails, it’s also helped correct the massive price disconnect between Bakken crude and U.S. benchmark West Texas Intermediate. Listen in to what Continental Resources, Inc. (NYSE:CLR) President and COO Rick Bott had to say in his company’s last earnings release:

We’ve recently seen a significant improvement in Bakken oil price differentials, reflecting higher volumes being shipped by rail to the coasts and the anticipation of increased pipeline capacity … We now have excess transportation capacity in both pipe and rail, and, with additional infrastructure projects in the planning and construction stages, capacity should remain ahead of Bakken production growth.

This means one thing, Bakken producers are going to get more money for the oil that’s produced. That’s better for both margins and profits and something that investors don’t want to miss. You also don’t want to miss the end phrase of that quote. Capacity remaining ahead of Bakken production growth could squeeze midstream margins if we end up with more capacity than is needed. If nothing else, its something to keep an eye on.

The deepwater is a wellspring of profits
Judging by some of the valuations in the oil-field service and equipment space you’d think that the deepwater drilling business was as dry as the U.S onshore has been over the past year. That couldn’t be further from the truth. Last year was actually the best year ever for deepwater drillers. Discoveries were up 40%, with a total of 52 discoveries across the world.

The thing is, few people noticed. Take the comments from National-Oilwell Varco, Inc. (NYSE:NOV) Chief Operating Officer Clay Williams:

Offshore drilling contractors steadily committed capital through 2012 to expand our deepwater fleets and we believe that this will continue through 2013. Our outlook for continued strong deepwater orders is a view that appears to be out of step with Wall Street’s conventional wisdom, which seems likely to have convinced itself that deepwater rig ordering will slow. Candidly, we do not understand why.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!