For Investors: Energy Sector -- Low Valuations; Future Growth; Low Risk -- Wall Street Journal

Link here.

The energy sector in particular stands out in this regard. A current holding that reflects our value bias is Chevron (CVX). Chevron trades with a forward 12-month p/e of 6.9 and even the trailing p/e is less than 10. Those valuations are quite attractive.


The valuations we are seeing in the financial sector are also incredibly low. The risks in financial stocks right now bother me more than the risks associated with the energy companies. But a company like Discover Financial Services (DFS) - with modest valuations and a strong, steady upward trend in earnings estimates - is attractive to us. You can almost go to any of the economic sectors and identify securities that are being priced at single-digit p/e. While we don't think that low p/e alone is reason enough to buy a stock, below-market valuation tends to be a characteristic that is common in our portfolios.

By the way, the first company mentioned in this extensive interview was ... drum roll ... AAPL, my favorite company. I do not hold any shares in Apple, Inc., however.