Pax World Growth Fund Manager Sees Continued Oil Shock for Investors, With Prices Rising as High as $55 a Barrel
20 April 2005 - 4:30AM
PR Newswire (US)
Pax World Growth Fund Manager Sees Continued Oil Shock for
Investors, With Prices Rising as High as $55 a Barrel Energy Stocks
Remain Attractive, But 'Very Disruptive' Period Not Over Yet; Five
Companies Highlighted as Attractive From a Social and Environmental
Standpoint NEW YORK, April 19 /PRNewswire/ -- Energy stocks remain
good bets for growth-minded mutual fund shareholders and other
investors, but a "very disruptive" oil shock period may continue to
play out for several months, with oil prices topping out on a
sustained basis as high as $55 a barrel, according to Pax World
Growth Fund (PXWGX) Manager Paul Gulden. In a news media briefing
today, Gulden outlined his views on likely oil price movements and
the prospects for five stocks: Chicago Bridge and Iron Co.
(NYSE:CBI); Apache Corp. (NYSE:APA); Chesapeake Energy Corp.
(NYSE:CHK); Hydril Co. (NASDAQ:HYDL); and Questar Corp. (NYSE:STR).
Gulden said: "I see continued volatility in the oil sector, where a
terrorist activity or other supply disruption could lead to a brief
'super spike' in prices. There may still be a ways to go on the
very disruptive oil shock that we are being buffeted by right now,
but I see oil prices settling down in the $40-$55 range, with the
latter being the likely high-end. " Gulden added: "Energy remains a
good place for growth-minded investors to take advantage of the
current opportunities. Within this sector, Pax World prefers to
focus on natural gas, which is a considerably cleaner source of
energy than oil or coal. Investors should realize that there are no
completely 'clean' energy companies. However, some companies are
clearly leaders, either through impact mitigation strategies or
development of innovate technologies that reduce or prevent
pollution. Several of the social and environmental leaders in the
energy sector look particularly attractive right now." The Pax
World Growth Fund manager highlighted five companies: * Chicago
Bridge and Iron Co. (NYSE:CBI) is one of the world's leading
engineering, procurement and construction (EPC) companies,
specializing in lump-sum turnkey projects for customers that
produce, process, store and distribute the world's natural
resources. Gulden focuses on the fact that CBI is the leading
company manufacturing natural gas terminals to convert liquefied
natural gas (LNG) into a usable energy form after it has been
shipped. Gulden sees the company as a critical link in the chain of
natural gas production that is likely to become a bigger part of
the U.S. energy consumption picture. (As of March 31, 2005, CBI
represented 3.2 percent of the Growth Fund portfolio.) * Apache
Corp. (NYSE:APA) and Chesapeake Energy Corp. (NYSE:CHK) are two of
the best domestic energy exploration companies in the business,
according to Gulden. Both have good oil and gas reserves and
potential for more in the areas where they operate. Additionally,
both these companies benefit from a strong emphasis on natural gas.
Natural gas is an environmentally viable option for investors
seeking "cleaner" investments in the oil and gas sector. (As of
March 31, 2005, APA and CHK represented 2.7 percent and 2.3
percent, respectively, of the Growth Fund portfolio.) * Hydril Co.
(NASDAQ:HYDL) and Questar Corp. (NYSE:STR) are on the short list of
energy stocks that Gulden favors. Hydril is one of the best deep
water service companies in the world, according to the fund
manager. Hydril's advanced-design casing and tubing connections
ensure the integrity of some of the world's deepest wells and are
made to safely contain very high pressure in the tubing and casing
strings that conduct oil or gas to the surface from deep in the
earth. Gulden notes that Questar is a top-notch utility/exploration
company that has major holdings in the Pinedale Antecline natural
gas basin in western Wyoming, which is believed to have enormous
potential. Questar will have to proceed carefully because this is
an environmentally sensitive area and all natural gas drilling
creates some surface disturbance. However, on the Pinedale
Antecline, Questar has adopted a directional drilling technique to
develop its acreage with a fraction of the disturbance created by
the opening up of a traditional natural gas field. In addition, 63
percent of Questar's fleet is fueled by natural gas, and the
company supports fuel cell research. (As of March 31, 2005, HYDL
and STR represented 2.6 percent and 4.4 percent, respectively, of
the Growth Fund portfolio.) This news release does not constitute
an endorsement of these companies' attractiveness as an investment.
Investment return and principal value of an investment will
fluctuate, so that an investor's shares, when redeemed, may be
worth more or less than their original cost. You should consider a
fund's investment objectives, risks, charges, and expenses
carefully before investing. For this and other important
information about the fund, please obtain a free fund prospectus by
calling 1-800-767-1729 or visiting http://www.paxworld.com/. Please
read it carefully before investing. ABOUT PAUL GULDEN AND PAX WORLD
FUNDS Paul Gulden has over 30 years of investment world experience.
He is division head and chief investment officer of H.G. Wellington
Capital Management, which he joined in 1977. He was a senior
portfolio manager and general partner at McMullen & Hard, and
investment advisory and brokerage firm and earlier was an
investment specialist at the Bank of New York. Paul Gulden believes
that attractive growth stocks are found across a range of market
capitalizations, from up-and-coming smaller companies in growth
industries, to accelerating mid-size high achievers, to
acknowledged large-company industry leaders. The Pax World Growth
Fund's holdings are focused within economic sectors that seem
likely to grow faster than the overall rate of GDP growth. Pax
World Funds -- including Pax World Balanced Fund, Pax World Growth
Fund, Pax World High Yield Fund and Pax World Money Market Fund --
seek to enable persons of conscience to invest in keeping with
their ethical values and to challenge corporations to establish and
meet certain ethical standards. The Funds seek to invest in
companies that produce goods and services that improve the quality
of life such as health care, technology, housing, food, education,
pollution control, utilities, and leisure-time activities and that
do not invest in companies that make defense or weapons-related
products or that derive revenue from the manufacture of tobacco,
alcohol, or gambling products. Pax World Management Corp. 222 State
Street Portsmouth, NH 03801 Distributor: H.G. Wellington & Co.,
Inc. -- Member NASD/SIPC DATASOURCE: Pax World Funds, Portsmouth NH
CONTACT: Patrick Mitchell, +1-703-276-3266, or , for Pax World
Funds Web site: http://www.paxworld.com/
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