Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Monday March 10.
Cramer went to Louisiana for Monday's Mad Money's Invest in America special program to demonstrate the power of the domestic oil and gas revolution as a key long-term theme. Standing on an Ensco (ESV) rig in the Gulf of Mexico, he said that ESV has a 6% yield, not only because of dividend increases, but because the stock has dropped to the point where it is undervalued. Halliburton (HAL) is transforming old oil fields and bringing them back to life. The stock has risen 10% so far this year and has an aggressive buyback.
Interview with Jim Brown, Halliburton's President of Western Hemisphere operations
Halliburton is the second largest oil company in the world and has large exposure to domestic shales. Jim Brown said the most revolutionary developments in the domestic oil industry have been deepwater finds (particularly in the Gulf of Mexico), technology that allows more productive drilling in mature assets, and horizontal and directional drilling. Brown said that these developments have enabled HAL to produce more oil efficiently and at lower cost. The industry is "resilient," and Brown expects strength long term.
Energy XXI (EXXI) is a pure play on offshore drilling that has significant assets in the Gulf of Mexico. The company recently bought assets from Exxon Mobil (XOM), and CEO John D. Schiller says EXXI is "just scratching the surface" in the oil it is finding. Schiller reports a high success rate and the ability to keep costs down. EXXI has made aggressive buybacks and should continue to benefit from the domestic oil renaissance.
CEO Interview: John Ferriola, Nucor (NYSE:NUE)
Nucor (NUE) is a steel company that built a facility in Louisiana so it can benefit from low-cost natural gas. CEO John Ferriola explained that large quantities of energy are needed to produce steel, and securing supplies of domestic natural gas at a low cost enables Nucor to produce cheaper, high quality steel and to stay ahead of the competition overseas. Nucor's steel is also environmentally friendly, since the company uses cleaner raw materials. Nucor plans to build more facilities close to cheap, plentiful natural gas sources.
Interview: Bobby Jindal, Governor of Louisiana
Louisiana Governor, Bobby Jindal, discussed the oil and gas revolution and how it is affecting his state's economy. Governor Jindal pointed out that Louisiana is creating jobs and is growing 50% faster than the national economy. He attributes this growth to lower taxes, a 26% cutting of the state's budget and the oil and gas boom, which is creating jobs. One reason wages for these jobs can still be relatively high is the superior production rates, thanks to technological advances and rich resources.
Get Cramer's Picks by email - it's free and takes only a few seconds to sign up.