Our favourite oils

Article Excerpt

We focus on oil companies with large reserves that generate dependable cash flows. We also prefer stocks that mainly operate in politically stable areas, particularly North America. This approach has paid off, as two of our favourite oil stocks have largely escaped the current turmoil in the Middle East. CHEVRON CORP. $102 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 2.0 billion; Market cap: $204.0 billion; Price-to-sales ratio: 1.0; Dividend yield: 2.8%; TSINetwork Rating: Above Average; www.chevron.com) began exploring for oil in Libya in 2005, after the U.S. dropped its economic sanctions on the country. However, its discoveries were too small to justify further investments. As a result, Chevron let its five-year exploration licenses expire last year. Chevron is a buy. APACHE CORP. $121 (New York symbol APA; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 364.6 million; Market cap: $44.1 billion; Price-to-sales ratio: 3.6; Dividend yield: 0.5%; TSINetwork Rating: Average; www.apachecorp.com) gets 20% of its oil and…