Wednesday, May 03, 2006

Mr. Stewart Goes to Houston.

James B. Stewart is a columnist for the Wall Street Journal and SmartMoney, as well as the author of a number of books on business and investment topics, and has a lot of financial experience under his belt. I have no idea what his track record is on investments, but his columns reflect a lot of saavy and intelligence.

So I feel rather less pseudo Internet bubblehead-ish when I read his new column, which suggests investing in oil service, among other things.

Note: For some reason this column has a different title in the WSJ than SmartMoney, but it appears to be the same article. The SmartMoney version is free.

WSJ: Prospecting in the Energy Sectors Is Likely to Pay Off in Long Term. [$]

SmartMoney: Playing Energy.


Eventually demand should ease and production increase, which is the only long-term solution to high oil prices. Needless to say, this would knock energy stocks from the lofty perches they've recently been occupying.


One of the savviest investors in the oil and gas arena I know is a Houston-based executive who recently told me he's been aggressively buying stocks in the oil-services sector. In the past, his suggestions have been impeccable. Among the stocks he mentioned are BJ Services, which specializes in pressure pumping, and Noble Corp., which focuses on deep-ocean drilling. I recently sold Noble in some premature profit-taking but still own Smith International, which makes a wide array of oil-field equipment, including drill bits. There are also oil-services exchange-traded funds, such as the Oil Services HOLDRs.

[By the way, it's possible his source is John Olson.]