CNOOC & EVR are good stocks to Watch for 2011
CNOOC – China National Offshore Oil Company Limited (CEO) - is Robert Hsu’s pick for 2011. Robert writes China Strategy and Asia Edge, and sees CNOOC benefiting from two big trends during the year: Inflation will boost crude prices, as demographics boost China demand. He says that rising inflation is by far one of the most important economic trends in China — and indeed, the world. He expects the current commodity bull market to continue, and that we’ll see a return to $100 oil in 2011.
A big driver of higher oil prices is China’s oil consumption, and the best way to take advantage of the strength in China’s oil production industry is by investing in CNOOC. CNOOC is the only oil company in China permitted to conduct exploration and production activities offshore in conjunction with foreign governments and companies. The company has teamed with over 70 international oil companies to exploit its monopoly drilling rights on huge undiscovered reserves of oil and natural gas in the South China Sea.
Evercore Partners (EVR) is an M&A specialist that will see big business in 2011, according to Hilary Kramer’s GameChangers. She labels CEO Ralph Schlosstein as one of the greatest dealmakers in the history of Wall Street, and says he has made Evercore the go-to player for advising companies on large deals in this red hot M&A market. A recent study from Thomson Reuters and Freeman Consulting Services concluded that the global market for M&A will surge 36% in 2011 to over $3 trillion.Schlosstein recently said:
A new wave of corporate takeovers is building. We tend to have five- to seven-year up cycles; we are in the first year.
Hilary expects earnings to grow 77% in 2011, which means EVR is selling for a price/earnings ratio of only 19x. She has a buy on the stock under $33.50, targeting $40 or better in 2011.