- "The Russian stock market has been recently out of favor, but valuations seem to be too much cheap to ignore.
- Investors should look for companies with low governmental influence like Lukoil, which is mainly owned by its management.
- Lukoil is one of the world's largest oil & gas companies and has very good growth prospects.
- It currently trades at only 4x its estimated 2014 earnings and offers a dividend yield of 5%.
The recent crisis between Russia and Ukraine has led to significant drops in Russian shares. Russian stocks were already cheap before the recent crisis, and took further beating after the Crimea standoff. For contrarian and value investors this may represent a good time to buy, especially quality companies with below-average political risk. One interesting opportunity may be Lukoil (OTCPK:LUKOY), one of the world's largest oil & gas companies. Its current market capitalization is about $45 billion, and is traded in the U.S. in the over-the-counter [OTC] market.
Lukoil is Russia's second-largest oil company, and one of the world's biggest vertically integrated companies for the production of crude oil and gas as well as for the refining of petroleum products and petrochemicals. Headquartered in Moscow, Lukoil is the second-largest public company, after Exxon Mobil (XOM), in terms of proven oil and gas reserves. In 2012, the company had 17.3 billion barrels of oil equivalent [boe], accounting for some 0.8% of global oil reserves. The company has operations in 38 countries around the world".
Source: Seeking Alpha
