Three Reasons EnCana Is the Best Large Cap Clean Energy Investment
Kurt Wulff (McDep Associates) submits:
Buy-recommended EnCana Corporation (ECA) offers unlevered appreciation potential of 8% to a McDep Ratio of 1.0 where stock price would equal Net Present Value (NPV) of $35 a share. Fourth quarter results, released on February 11, support our estimate for unlevered cash flow (Ebitda) in 2010. Following the November 30 spinoff of buy-recommended oil producer, Cenovus Energy (CVE), EnCana intensifies its concentration on natural gas to 93% of NPV.
We call EnCana the best large cap clean energy investment for at least three reasons. First, we believe natural gas is the runaway first choice as clean energy, particularly with the promise of more abundant economical supply. Second, EnCana’s 93% concentration on natural gas is the highest among large cap stocks. Third, the company is well-managed, starting at the top. Chairman David O’Brien has a long record of value creation from the day he took over at resource-rich Canadian Pacific and turned the conglomerate into a series of high performing independent companies.
Investing, Long Term Investment, stock market | admin March 16, 2010
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