The Street did not take a liking to Nexen Inc.’s second quarter results, which you can read about here. Since the ugly, and Nexen’s defense, is detailed there, let’s talk about the pluses.
The oil and gas producer announced a share buyback of up to 10% of its float or 53 million shares, and Andrew Potter, an analyst at UBS Securities, thinks that “could be pursued aggressively” given his expectation of $1.5-billion in free cash flow per year.
Mr. Potter encourages investors to get in after Thursday’s 10% drop. “Although we were disappointed with the large headline miss in [the second quarter] results, we believe the 10% selloff in the stock is far overdone and is very compelling buy at current levels,” he said in a note to clients.