The days of $80 oil are over, according to Gerald Jordan, portfolio manager of the Jordan Opportunity Fund, and that is why he’s placing his bets on the oil services sector.
Jordan’s first pick is Schlumberger, which he thinks has the potential to earn close to $5 this year.
“As recently has a month and a half ago, Schlumberger was about as cheap as it had been in 20 years, and that was because a lot of folks in the market, and a lot of folks still believe this, that the energy cycle is probably close to being over,” said Jordan.
“We don’t believe that,” he added. “It’s a buy, and they’re going to have better guidance as the year goes on. North America is turning for them. They just got some lumpiness right now in Latin America that may cost them a penny or two a share, but going forward this is a cheap stock.”
Jordan added that he would wait to buy the stock until after its earnings report on Friday.