Wednesday, February 15, 2017

Sold National Oil Well Varco (NOV)

I sold NOV for a 13% gain. I thought when oil price bottomed last year that the under investment in the oil industry would lead to a big rebound in oil. I was even more encouraged after the recent OPEC announcement that the member states were going to cut production. The problem is that US shale production was quick to respond and fill the void. Rig counts are up in the US and the recent oil inventory numbers are indicating that we are still over supplied.

I think it will take a lot longer to work off the over supply and therefore oil prices will not be heading as high as I thought they might. This will result in less investment in new production and less business for NOV. I will will take my 13% gain and move on.

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