Italy's Eni SPA ADR (NYSE: E) has one of the most successful and fastest-growing E&P operations of any major integrated energy firm," says energy expert Elliott Gue.
In his The Energy Strategist, he notes, "And despite its defensive characteristics, Eni offers an impressive 8.5%, the highest of the large integrated oils."
"ENI derives close to three-quarters of its operating income from exploration and production (E&P) and just 3.8% from refining and marketing.
"Thus, Eni has more leverage to E&P than most large integrated energy firms and less exposure to refining margins. The company’s other main business is gas and power, accounting for close to 22% of operating income.
"Eni has one of the most successful and fastest-growing E&P operations of any major integrated energy firm.
"In the third quarter, Eni’s production grew to 1.764 million barrels of oil equivalent per day (boe/d), up 6.3% over the same quarter a year ago, the fastest growth of any integrated firm in my coverage universe.
"And Eni has a large number of new projects scheduled to come onstream over the next three years that are poised to power further production growth.
"One region of particular interest for Eni the company has big growth plans in Africa. For example, in Libya, the firm is rapidly ramping up its natural gas production. Eni also has extensive operations in Algeria, Egypt, Angola, Tunisia and Nigeria.
"Outside of Africa, Eni’s two largest areas of operation are the Caspian area and Italy. In the Caspian, Eni is part of the massive Kashagan oil project; the company has a 16.8%, the same percentage stake as ExxonMobil, Royal Dutch and Total.
"Like other integrated oil and gas companies, Eni has a low cost of production and can remain profitable even with oil and natural gas prices at current depressed levels.
"And, despite its defensive characteristics, Eni offers an impressive 8.5%, the highest of the large integrated oil companies. Buy Eni under 60.
"Be sure that if you purchase the stock on the New York Stock Exchange that you purchase the symbol E, -- not ENI, which is the symbol for Enersis, a power generator in South America."
