Apache Corporation (APA), EOG Resources Inc (EOG): Three Stocks Near 52-Week Lows Worth Buying

Chemical reaction
The disappointments are starting to mount for investors in OMNOVA Solutions Inc (NYSE:OMN), an emulsion polymer and specialty chemicals maker that has missed the Street’s estimates in worsening fashion for three straight quarters. Its first-quarter results, released earlier this month, showed a 9% decline in total revenue from the year-ago period because of lower volumes in Europe and India, and business seasonality. However, optimistic contentions could also be made based on this same earnings report.

For one thing, OMNOVA Solutions Inc (NYSE:OMN)’s growth prospects appear very strong in Asia, where its chemical business tied to the oil industry looks poised to explode higher. Even with GDP growth of “just” 7.7%, China is committed to finding and exploiting new energy sources, meaning OMNOVA’s products should remain in high demand. Elsewhere, OMNOVA is poised to boost production with additional global manufacturing facilities coming on-line later this year. Additionally, OMNOVA will benefit from domestic and Chinese home and commercial construction because of its roofing and construction applications.

OMNOVA has remained profitable despite its recent EPS misses and continues to produce meaningful cash flow to drive operational expansion. At eight times forward earnings, even with a recent rash of earnings misses, I think the reward potential easily outweighs the risk.

Foolish roundup
This week’s theme is all about “How bad can it really get?” For the two oil and gas explorers and producers, I feel investors are paying too much attention to their previous spending habits and not enough attention to their production growth potential. For OMNOVA, it’s all about servicing the right industries at the right time — and I feel it’s well-positioned to accomplish that.

The article 3 Stocks Near 52-Week Lows Worth Buying originally appeared on Fool.com.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool owns shares of Apache.

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