Deepwater and Ultra-Deepwater exploration and drilling have shown a remarkable increase over the past few years. This is due in part to the development of new technologies which have reduced operational costs and risks, as well as the finding of reservoirs that will produce high production wells. There are many zones throughout the world that possess the potential for high quality production wells that not so long ago were "out of reach."

Oil and gas service companies such as Halliburton (HAL), National Oilwell Varco (NOV) and Baker Hughes (BHI) have pushed the envelop with their engineering and technological advancements. Many of these advancements have opened up a greater amount of opportunities in areas such as the Pre-Salt region off the coast of Brazil, the U.S. Gulf of Mexico and the Barents Sea off the northern coast of Norway.

Each of these regions will looking to increase production and capitalize on

Value in this market is getting harder to find by the day in this continuously rising market that has not had even a 4% decline since Mid-November. A couple of sectors that have underperformed in 2013, materials and energy, seem to be on the move in mid-day trading Monday. Silver and gold miners are generally up significantly today as are the refiners. Oil services firms also seem to be doing well in mid-day trading. One oil services firm that has vastly underperformed the S&P as well as its brethren Halliburton (HAL) and Schlumberger (SLB) over the last six months (see chart) is National Oilwell Varco (NOV). Given its valuation and some recent positive catalysts, it looks primed for a catch up move upward.

(click to enlarge)

Recent positives for NOV:

• The company just announced it is doubling its dividend. The shares will now yield ~1.5%
• Earlier this month in

This article is part of a series that provides an ongoing analysis of the changes made to Berkshire Hathaway's US stock portfolio on a quarterly basis. It is based on Warren Buffett's regulatory 13F Form filed on 05/15/2013. Please visit our Tracking 10 Years Of Berkshire Hathaway's Investment Portfolio article series for an idea on how his holdings have progressed over the years and our previous update highlighting the moves during Q4 2012.

During Q1 2013, Berkshire's (BRK.A) (BRK.B) US long stock portfolio increased 12.89% from $75.31B to $85.02B. The total number of holdings remained steady at 41. Archer Daniels Midland and General Dynamics, two small positions were liquidated and replaced with Chicago Bridge & Iron and Starz. The majority of the existing positions were left untouched although there were some incremental purchases and a few minor sells. Buffett continues to hold a very concentrated portfolio with

On March 28, 2012 I wrote an article called: The U.S.'s New Industrial Revolution: Natural Gas. From the stocks mentioned in the report only International Paper (IP) performed better than the Dow Jones Industrial Index (+15.14%) in the same time period.

(Click to enlarge)

Where do we go from here?

As energy prices decline, consumers and certain energy intensive industries will benefit.

• U.S. natural gas customers have seen a price decline of more than 40% since the peak in July 2008.
• Lower natural gas prices will boost chemicals, steel and paper manufacturing companies, as well as industrial gas suppliers and certain fertilizer producers.

According to the International Energy Agency in its World Energy Outlook 2012, the extraordinary growth in oil and natural gas in the U.S. is a "sea-change in global energy flows". By around 2020, the United States is projected to become the largest global oil producer

With the S&P 500 crossing the 1,600 mark, I find myself deviating further than I ever have from the crowd or the indexes in terms of asset allocation. I don't have the slightest interest in 99% of consumer staples, pharmaceutical or utility companies. Duration risk petrifies me in long-term fixed income, and the thought of buying 10-year treasuries with a yield of 1.6% is about as attractive as getting another root canal. With that said, we are heavily invested in a concentrated portfolio of businesses that trade at significant discounts to intrinsic value. These opportunities are focused in industries with serious "hair" on them, or anxiety associated with them such as financials, energy and large-cap technology. National Oilwell Varco, Inc. (NOV) is an example of a great business that is constantly separating itself from its competitors and is available at a very fair price despite what I believe to be

Deepwater exploration and drilling have shown a remarkable increase over the past few years. This is due in part to the development of new technologies which have reduced operational costs and risks, as well as the finding of reservoirs that will produce high production wells. There are many zones throughout the world that possess the potential for high quality production wells that not so long ago were "out of reach."

Oil and gas service companies such as Halliburton (HAL), National Oilwell Varco (NOV) and Baker Hughes (BHI) have pushed the envelop with their engineering and technological advancements. Many of these advancements have opened up a greater amount of opportunities in areas such as the Pre-Salt region off the coast of Brazil and the U.S. Gulf of Mexico.

The Pre-Salt region off the coast of Brazil is a "hot spot," opening up many opportunities for oil and gas

By Matt Doiron

T. Boone Pickens became a billionaire through success in the oilfield, and now manages both his own wealth and that of outside investors in BP Capital. We track the fund's quarterly 13F filings in our database, as well as those of other hedge funds and notable investors, as part of our work developing investment strategies; we have found, for example, that the most popular small-cap stocks among hedge funds generate an average excess return of 18 percentage points per year (see the details here). Information from the most recent 13Fs may be considered a little old by some investors, but we can also find stocks which Pickens has owned each of the last four quarters in order to provide initial ideas for further research. Here are the five largest holdings by market value from the end of December that Pickens owned in each quarter of 2012

National Oilwell Varco, Inc. (NOV)

Q1 2013 Earnings Call

April 26 2013 9:00 am ET

Executives

Loren Singletary – VP, IR and Industry Relations

Merrill A. Miller Jr. – Chairman, President, Chief Executive Officer

Clay C. Williams – President, Chief Operating Officer

Jeremy D. Thigpen – Senior Vice President and Chief Financial Officer

Analysts

Marshall Adkins – Raymond James

James Crandell – Dahlman Rose & Co.

Robin Shoemaker – Citigroup

Kurt Hallead – RBC Capital Markets

Bill Sanchez – Howard Weil

Presentation

Operator

Welcome to the National Oilwell Varco First Quarter Financial Results Earnings Call. My name is Don and I will be your operator for today’s call. At this time all participants are in a listen-only mode later we will conduct a question-and-answer session. Please note that this conference is being recorded.

I will now turn the call over to Loren Singletary, Vice President of Investor and Industry Relations.

National Oilwell Varco (NOV) is expected to report earnings on Friday, April 26th. The whisper number is $1.33, four cents behind the analysts' estimate. NOV has a 87% positive surprise history (having topped the whisper in 13 of the 15 earnings reports for which we have data).

Earnings history:

- Beat whisper: 13 qtrs
- Met whisper: 1 qtrs
- Missed whisper: 1 qtrs

Our primary focus is on post earnings price movement. Knowing how likely a stock's price will move following an earnings report can help you determine the best action to take (long or short). In other words, we look at what happens when the company beats or misses the whisper number expectation.

The table below indicates the average post earnings price movement within a one and thirty trading day timeframe:

(click to enlarge)

The strongest price movement of -1.5% comes within five trading days when the company

In a previous article, I suggested that young investors should look beyond yield when choosing which stocks to add to their retirement portfolios. Having several decades between now and retirement affords investors in their 20s and 30s the opportunity to evaluate stocks based on other factors such as dividend growth, payout ratio and particularly, valuation.

I currently hold five stocks in my portfolio. All but one currently pay a dividend. I have generally tried to find stocks that I believe are fairly valued or, if possible, undervalued that offer the opportunity for capital appreciation, as well as accumulation of shares through dividend reinvestment. Obviously, I don't provide this list as a be-all and end-all list of stocks for investors to buy. Rather, I provide it as an example of how I put my own strategy to use. I hope young investors will use this list as a starting point

In spite of the tweet scare, most indices ended higher yesterday after a series of positive earnings and probably because of rising new home sales. Twenty four of the thirty DOW stocks were up, and the gainers-losers ratio in both NYSE and NASDAQ was close to 3:1. Most of growth stocks that have good analyst ratings have outperformed their corresponding indices in the past four weeks.

In this article we discuss four stocks that have not been part of this rally in spite of having Buy or better analyst ratings and EPS growth projections in the coming years. These stocks have lost at least 15% value in the last four weeks as the markets got closer to record highs.

(1) TEREX CORP. (TEX)

Terex Corp. manufactures construction and industrial equipments such as aerial work platform equipment, different types of cranes, light towers, rail equipments and other equipments

The energy sector has been in a solid turnaround trend since July 2012. In the last five trading days, however, the Energy Select Sector SPDR (XLE) has shed about 3.71%. Several big energy companies have in fact declined by more than 8% in this short period. This appears to be an overreaction by the market and is unwarranted.

Undeserving Performance

Phillips 66 (PSX), Pioneer Natural Resources (PXD) , EOG Resources Inc. (EOG), Ensco Plc (ESV) and Andarko Petroleum Corp (APC) have been the worst five performers in the Energy sector in the last five days (as of close on April 16, 2013).

Why is this performance underserving? These stocks seem to be attractively valued based on their fundamental statistics and valuation metrics, as shown in the table below.

(click to enlarge)

In addition, all these five companies have overall more buy or better analyst ratings, and they have

It goes without saying that young investors like myself can afford to invest more aggressively than individuals closer to retirement. Our friends in their 50s and 60s might be more comfortable investing in extremely defensive positions in well-established companies that are going to turn a profit no matter what the macroeconomic conditions might be, while collecting a stable dividend four times a year. There is certainly nothing wrong with that investment strategy for investors of any age.

Folks in their 20s and 30s, however, might be looking for something more out of their investments. Don't get me wrong - dividends are important and should be a factor for anyone deciding where to put his or her money. But rather than focusing solely on yield, young investors should look at dividend growth and payout ratio.

Company A, which pays a 5 percent yield, might seem attractive at first glance. But if