progress that justifies our estimate of Net Present Value [NPV] of US$65 a share. The single most important characteristic may be 73% concentration on clean fuel.
Then at more than $40 billion in market cap the company is large enough to be important to almost any investor. For the politically risk-averse it can be consoling that ECA is domiciled in Canada and has all of its assets in North America.
Environmentalists can take heart that every btu from coal displaced with one from natural gas cuts the related carbon dioxide emissions by a half. Momentum investors can be encouraged that stock price and six-year natural gas price look like they have formed bases and embarked on new advances with current quotes above the 200-day or 40-week average.
For extra potential, natural gas as a commodity could appreciate 70% relative to oil in a strong demand situation. Liking the strategic appeal, the valuation and the performance, we favor ECA stock at a double weighting in our illustrative energy portfolio concentrated on real assets that promise a high return providing clean energy for global growth.
Originally published on April 25, 2007
ECA 1-yr chart:
