Energy stocks have gotten hammered recently, but Scott Richter, who manages the Fifth Third All Cap Value Fund, sees opportunities in the sector.
“Hedge fund redemptions, a slow economy, credit crisis are near-term stressers, but the long-term supply-demand balance is still in the favor of the bulls," said Richter. "So if you can accumulate these over the next several quarters, I think you can make some money over the haul," he added.
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Richter’s first pick is Exxon Mobil .
“It’s cheap, number one, (has a) great balance sheet, which you have to have in a credit crunch, and they’re going to get a lift from ENP projects in Brazil…and gas shale projects in Eastern Europe.”
He also likes XTO Energy , which he calls a “defensive play.”
“Real high-growth production profile, a low-cost producer, which you have to have in this difficult commodity environment, and they have a large inventory of very low-risk U.S. projects that they can do that aren’t tied to leases and aren’t tied to the capital markets.”
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