To paraphrase Mark Twain, Italy's Eni (E)
is a good upstream company spoiled. In this case, the spoilage comes
from money-losing capital sinkholes in the downstream operations like
its Gas & Power and Refining & Marketing operations. To be sure,
Eni's upstream operations are not perfect or risk-free, as the company
has a recent history of disappointing on production growth targets and
its production is heavily weighted toward some pretty dicey countries.
It's hard for me to argue strongly for buying Eni over other majors like
Statoil (STO)
(which I own), but I will say that sentiment is pretty bearish on Eni
relative to its solid production pipeline and further progress in
reforming its downstream operations and/or selling off subsidiary stakes
could unlock some worthwhile upside.
Please continue here:
Eni's Solid Upstream Overshadowed By Multiple Downstream Issues
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