Apache: This Oil And Gas Company Is Underpriced

By Dividendinvestr:

By Renee O’Farrell

Acquisition is one of the fastest ways to grow a company and, in the case of the geographically diverse independent oil and gas company Apache Corp (APA), it is extremely effective. Apache has been on an acquisition binge lately. In January, the company agreed to buy the privately-held Cordillera Energy for $2.85 billion. The purchase more than doubles its acreage in the Anadarko Basin and increases its production of the higher-margin liquids in that region to 53%. Apache has also been extending its holdings in Egypt as well as developing its North Sea assets. Apache has a strong track record of unlocking value from the assets it acquires and making strategic investment in large projects. Right now, the company’s operations are divided 46 to 54, liquids to gas.

On May 3, Apache released its first quarter performance. The company reported earnings of $778 million, or $2.00 per


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