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The price of oil has been rising and it has been resilient even as concerns over the global economy persist. Increasingly solid data from the U.S. and tensions over Iran's nuclear program have been supporting factors, but the continuing debt crisis and recession in Europe, along with the possibility of a hard-landing in China should keep the oil rally from getting out of hand ... for now.

Future oil demand is likely to increase with a growing global population and rising incomes from consumers in emerging market countries. Because of this, it makes sense for investors to have exposure to oil in their portfolios. If Europe takes control of the debt crisis, and stronger growth kicks in for China as well as other economies, we can expect much higher oil prices. With the recent stock market rally and jump in oil prices, it's getting harder to find stock bargains in this sector; however, thanks to a recent decline, Halliburton (NYSE:HAL) is a bargain worth buying now. This appears to be a very attractive time to start buying Halliburton, and here are 6 reasons why the stock should be considered by investors now:

1) Halliburton Company is poised to benefit from the rising global demand in energy because it provides critical products and services to the oil and gas sector. Halliburton is cashing in on the shale boom in North America, and the worldwide increase in deepwater drilling.

2) This company recently reported record results. Revenues for 2011, came in at $24.8 billion which was an increase of 38% from 2010. Net income for 2011, was $3 billion, or $3.26 per share, versus $1.97 per share in 2010. Furthermore, analysts expect earnings to continue growing, from about $3.90 per share in 2012 to around $4.53 per share in 2013.

3) Halliburton shares are trading well below the average analyst target price, which is about $51 per share. Based on the current share price of just $35, this stock could provide gains of about 45% sometime in the next 12 months, if analyst targets are met.

4) This stock is trading way below the 52-week high of $57.77, while many oil stocks, for example, Chevron (NYSE:CVX), are trading near 52-week highs. Halliburton shares trade for just about 7.5 times forward earnings, and it has the potential for multiple expansion in the future.

5) The stock would probably be significantly higher now if it were not for lawsuits relating to the oil spill in the Gulf of Mexico. BP (NYSE:BP) blames Halliburton for some of the liability it has in the oil spill, but Halliburton has denied the claims. This uncertainty could continue unless a settlement is reached with BP. However, BP has recently settled with other contractors so a settlement seems likely to come sooner or later. A settlement would remove uncertainty and the stock would have a strong chance of rising towards the analyst price targets of about $51 per share.

6) While waiting for a settlement and a higher stock price, investors are paid a dividend yield of about 1%. That may not seem like much, but with Halliburton earning close to $4 per share and paying out a dividend of just 36 cents per share, there is a lot of room for the company to raise the dividend in the future.

It often pays to buy stocks while some uncertainty is hanging over the company and Halliburton appears to be one of those opportunities.

Here are some key points for HAL:

  • Current share price: $35
  • The 52 week range is $27.21 to $57.77
  • Earnings estimates for 2012: $3.90 per share
  • Earnings estimates for 2013: $4.53 per share
  • Annual dividend: 36 cents per share which yields 1%

Data is sourced from Yahoo Finance.

Source: 6 Reasons To Buy Halliburton Stock While It Is Still Cheap