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Chevron: Déjà Vu 2009? Deep Value For Anti-Cyclical Investors Despite Low Oil Prices

The most publicized news item in 2014 must have been the collapsing crude oil price. Oil has lost nearly 50% of its value since the summer of 2014, and has dragged share prices of oil producers down with it. Wall Street and analysts were caught off guard by the price collapse, as were your average mom-and-pop investors. The ensuing panic led to a great deal of value destruction: Integrated oil businesses, independent E&P companies, offshore drillers, and oilfield service contractors all saw their valuations plunge.

Nonetheless, big oil companies offer investors a LOT of value and are simultaneously the most likely to withstand short-term price challenges. While it is true that the retreating oil price caused panic last year, a changing price dynamic can just as well be a major positive catalyst for oil companies like Chevron (CVX) or ExxonMobil (XOM).

Chevron set to rebound?

Probably the biggest misconception in… Read More …