MyMoney Online

3 experts agree: Sasol is an excellent investment right now

Nic Norman-Smith (Lentus Asset Management), Clive Ramathibela-Smith (Clivera) and Chris Gilmour (Absa Wealth and Investment) all agree; Sasol is one of the best companies to invest in right now...

Lentus Asset Management Chief Investment Officer Nic Norman-Smith:

Oil is cheap and nobody, so it seems, wants to hold Sasol shares right now. After peaking at over R600 a share it now trades at around R397.

“I like it! It’s the market’s discomfort that’ll get you outsized returns,” says Norman-Smith.

Ask yourself what the market hasn’t: Will oil stay cheap forever?

“Almost nobody predicted the large, sudden drop in the oil price. Yet now everybody is certain that it’ll stay at $60 for the next 20 years!”

Nobody really knows what the oil price is going to do, but the reality is a lot of the extra supply that has come on the market, such as shale oil and the Canadian oil sands, is expensive to produce.

“Oil is not about to disappear!” says Norman-Smith. “The electric car won’t become ubiquitous overnight.”

One of the cheapest oil firms on Earth

Sasol is one of the cheapest oil companies in the world. “The crashing oil price has hurt the Sasol share price a lot more than many of the global supermajors (BP, Chevron, ExxonMobil, Shell, Total)."

If you believe humanity will still be consuming oil for a while then Sasol is one of the cheapest entry points into this vital commodity.

Listen to the audio for more detail on why Norman-Smith is buying Sasol.

Clivera Chief Investment Officer Clive Ramathibela-Smith:

Absa Wealth and Investment Analyst Chris Gilmour:

Goldman Sachs predicts the oil price will stay low for the foreseeable future. Why would anyone in their right mind invest in Sasol?

“I don’t agree with Goldman Sachs,” says Chris Gilmour, Analyst at Absa Wealth and Investment. “I think the oil price will bottom out a bit higher than they're predicting. And when that happens the rebound will be fairly swift. I’m not saying prices will recover to US$100 a barrel, or even US$80, but we’ll get back to US$65/US$70 without much difficulty.”

Gilmour points to a massive drop in oil exploration in the wake of the recent oil price crash and production levels that are already tapering off in higher cost areas. “It’s a self-correcting mechanism. If you go back to 2009; that rebound was very swift as well.

“When the oil price inevitably recovers; Sasol will represent extremely good value,” concludes Gilmour.

Listen to the Soundcloud clip for more detail from Gilmour.


This article first appeared on 702 : 3 experts agree: Sasol is an excellent investment right now


Recommended

by NEWSROOM AI
Read More
Millennials – contrary to the stereotype - are very, very good with money

Millennials – contrary to the stereotype - are very, very good with money

Life is really hard for young adults, but they’re more than coping. Old Mutual research suggests older adults can learn from them.

Worried about money? How to have a courageous chat with your spouse about it

Worried about money? How to have a courageous chat with your spouse about it

Life planner Kim Potgieter shares five tips on navigating the complexities around money and relationships.

Why you should invest in Sasol, Aspen and MTN

Why you should invest in Sasol, Aspen and MTN

Clive Ramathibela-Smith, CIO at Clivera, discusses what he believes are the best investments on the JSE right now.

Why Busha Investment Group is buying Anglo American, Nedbank and Old Mutual

Why Busha Investment Group is buying Anglo American, Nedbank and Old Mutual

Anglo American, Nedbank and Old Mutual count among the hottest stocks on the Johannesburg Stock Exchange right now. Here’s why…

Why Sasol is a great investment (it’s because of, NOT despite, the oil price)

Why Sasol is a great investment (it’s because of, NOT despite, the oil price)

The market seems to believe oil will stay cheap forever. It can’t. And right now Sasol shares are very, very cheap.

Buy Sasol shares (despite very cheap oil) – market analyst

Buy Sasol shares (despite very cheap oil) – market analyst

Sasol shares are an excellent investment because of (not despite!) oil prices that won’t stay this low forever.

Popular articles
Hits from the bong (it’s legal!)… then off to work I go?

Hits from the bong (it’s legal!)… then off to work I go?

The consequences of consuming dagga at home and showing up at the office high. Bruce Whitfield interviews a labour lawyer.

Assisted suicide activist facing murder charge released on bail

Assisted suicide activist facing murder charge released on bail

Eyewitness News reporter Shamiela Fisher gives a summary of the court proceedings for Sean Davison.

Heinrich Volmink could've been a good mayor but Dan Plato gets the livery collar

Heinrich Volmink could've been a good mayor but Dan Plato gets the livery collar

Prof Jonathan Jansen sings Volmink's praises as Dan Plato is elected to lead the City of Cape Town taking over from De Lille.

'We can barely enforce tobacco legislation, how will we to deal with dagga?'

'We can barely enforce tobacco legislation, how will we to deal with dagga?'

International law enforcement expert and former Drug Unit Commander Lobo das Neves says ruling opens a different can of worms.

Key things to consider ahead of your retirement

Key things to consider ahead of your retirement

If you’re a baby boomer on the brink of retirement, here are a few things to consider ahead of time.

17-year-old learner killed teacher for not allowing him to jump the food queue

17-year-old learner killed teacher for not allowing him to jump the food queue

Spokesperson for Education department says the fact that this learner is still in Grade 10 at 17 may indicate there is a problem.