Oil Company Prospects – Essential Products And Bargain Priced Stocks

Oil Company Prospects – Essential Products And Bargain Priced Stocks

The oil industry's goal: Fill-R-Up



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Past performance makes oil stocks look like a terrible investment. Look to the future, and oil companies appear to have, well, no future. Worse, they are not "E" – The leading criterion in "sustainable" investing's ESG acronym (Environmental, Social, and Corporate governance).

As a result, some major pension and foundation funds are announcing new investment policies that remove oil company stocks from their lists of permitted holdings. Even Barron's is leaving oil companies out of their 2021 stock picks after their 2020 pick, Royal Dutch Shell, bombed.

So – What should we do? Avoid oil company stocks because they are under-performers, irrelevant to the world's future, or just plain bad actors?

No. We should view them as we would any company whose business line's heyday is past: Treat it as a "cash cow." That consulting term encapsulates the proper classification and treatment of a profitable division with stagnant or declining demand.



This is the position oil companies are in now – providing a needed global source of energy, but with declining demand.

Think of oil this way: It is an necessary product that we wish