National Oilwell Varco Quarterly Stock Valuation – September 2014 $NOV

National_Oilwell_Varco_Logo.svgNational Oilwell Varco qualifies for both the Defensive Investor and the Enterprising Investor. The Defensive Investor’s only initial concern is the short dividend history while the company passes all of the Enterprising Investor’s requirements. Consequently, all value investors following the ModernGraham approach based on Benjamin Graham’s methods should feel comfortable proceeding with further research into the company and comparing it to other opportunities through a review of Baker Hughes Inc. (NYSE:BHI).

From a valuation side of things, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $3.88 in 2010 to an estimated $5.53 for 2014, an overall growth rate of around 8.55% annually. National Oilwell Varco’s growth in its EPSmg demonstrates a long-term trend in the company’s earnings, a sight that value investors love to see. Overall, EPSmg has grown in each of the last five years, and it should be expected that growth will continue into the future. This level of demonstrated growth outpaces the market’s implied estimate of 2.81% earnings growth.

The ModernGraham valuation is based on an estimate of growth of 6.41%. As a result, it is clear that the market’s current pricing of National Oilwell Varco may be low, and therefore the ModernGraham conclusion is the company appears to be undervalued.

Read the full valuation on Seeking Alpha!

NOV Chart

NOV data by YCharts






2 responses to “National Oilwell Varco Quarterly Stock Valuation – September 2014 $NOV”

  1. David Avatar

    Why can’t we read the full valuation here?
    this redirection is kind of disappointing considering it requires yet another sign-up.

    1. Benjamin Clark Avatar

      David – I understand. I’m experimenting with providing additional content to Seeking Alpha in order to bring in more readers from their site. You should be able to access the Seeking Alpha content for free, and I wasn’t aware it would require signing up to do so. Unfortunately, Seeking Alpha won’t let me publish the full articles for free on my site. I do have the option of posting them behind my own paywall, in which case they would be available only to premium subscribers. I’ve been hesitant to take that approach though, because I’m not sure how my readers would react to that. Do you have any thoughts about whether that would be a preferred path?

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