FirstEnergy Capital CEO: Energy Sector Has 'Huge Amount Of Opportunity'
Forecast, Reality, New Forecast
“Well, I’ll tell you it’s been very, very difficult,” Chambers said.
“We have seen […] forecast drop dramatically from the third quarter of 2013, sometimes as much as 70 or 75 percent. So [...] companies that are heavily oil leveraged and had a heavier grade of oil are going to find that their share prices are going to pullback very significantly and we have seen that in the market.”
Have The Markets Overreacted?
“Well, in this type of situation, there is always, always overreaction and I think there is a lot of overreaction in this market, although certainly some serious downturns are warranted,” Chambers said.
“If you look at the companies that are subject to the most significant downturns, generally they have the highest amount of leverage and generally they have slightly higher cost structures. So, they are going to be impacted to a much higher degree than maybe some of their competitors.”
Are There Still Sector Opportunities?
On emerging opportunities in the energy sector, Chambers said, “I think there is a huge amount of opportunity here and really what you need to do is you need to find those companies that have cleaner balance sheets that are able to cut cost, that have lower operating cost and they are going to be able to find themselves in 2016 with an ongoing business plan and a profitable business."
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