mark, re. KEG, it is an oil-field service co.
That entire sector got pounded in 1998, with the decline in oil prices. The typical stock sells for less than half than a year ago. I'm actually investing now in that sector because I've looked for value stocks, and that's where I've found them.
While I'm unfamiliar with KEG, I did buy two other oil-drilling companies in December, as a value play. They have bounced pretty nicely so far in January. SLB and GLBL. They aren't small, though, and they have lots of institutional ownership, so they are different from the typical micro-cap January-effect play.
KEG's chart is unlike that of the other oil-service stocks: instead of simply going down in a smooth line all year long, it went up in a bubble last summer, and now that bubble has popped. There must be a story behind it, but I haven't looked at the news to see what it is.
I would be afraid of a company with a debt:equity ratio of 5 during a severe cyclical downturn, as this industry is now experiencing. KEG has such a ratio. |
