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THIS WEEK’S FOCUS

There is a certain kind of stock that makes experienced investors uncomfortable. The numbers look good. The price looks low. But something about it feels wrong, like a watch selling for five dollars.

This week's video is about exactly that kind of company — three of them, actually. Oil and gas businesses trading at fractions of what their fundamentals might suggest they're worth.

The question, as always, is whether the discount is an opportunity or a warning. Read on, then watch.

RECOMMENDED VIDEO

3 Cheapest Oil & Gas Companies

One has a P/E of just 6. Another is paying a 7% dividend. The third returned 504% over five years.

In this week's video, the Bald Investor runs three energy companies through a full 7-step fundamentals analysis covering financial health, growth, dividends, and valuation. The numbers are striking. But so are the risks, and those get equal attention.

If you've ever wondered how to tell the difference between a genuine bargain and a value trap in a cyclical industry, this is the video to watch.

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5 STORIES THAT MATTER THIS WEEK

Bill Ackman makes a $65 billion bet on music

Superinvestor Bill Ackman, whose fund Pershing Square already owns 4.5% of Universal Music Group — the label behind Taylor Swift and Drake — proposed a sweeping merger deal on April 7 that would value UMG at roughly €56 billion. The offer, pitched at a 78% premium to UMG's recent share price, hinges on Ackman's belief that moving the company's listing to the US would unlock substantially more value. As of April 10, UMG shares were still trading at just two-thirds of Ackman's proposed price, suggesting the market is far from convinced the deal gets done.

Levi Strauss reminds the market that brand power is real

Levi Strauss reported first-quarter earnings on April 7 that beat Wall Street on both revenue and profit, sending shares up 11% the following day. The more important detail was structural: for the first time, direct-to-consumer sales — through the company's own stores and website — made up more than half of total revenue. CEO Michelle Gass said the strategies are working. The company raised its full-year guidance. It's a quiet but meaningful sign that a 170-year-old brand has figured out how to own its customer relationship rather than rely on retailers to do it for them.

Delta's strong quarter came with an uncomfortable asterisk

Delta Air Lines posted first-quarter earnings on April 8 that beat analyst expectations handily — net income rose from $291 million to $423 million year on year. But CEO Ed Bastian paired the results with a notable warning: fuel costs are expected to add $2 billion to Delta's bill next quarter, and the airline will be "meaningfully reducing" its capacity growth plans in the near term. It's a useful reminder that an earnings beat tells you where a company has been, not necessarily where it is going. Bastian held his full-year guidance steady but declined to update it, citing too much uncertainty.

Disney's new CEO makes his first major move

Less than a month after taking the helm, Disney CEO Josh D'Amaro announced plans on April 9 to cut as many as 1,000 jobs, with the reductions falling heavily on the company's recently consolidated marketing department. D'Amaro, who built his reputation running Disney's parks business, had already signalled that he would run a leaner operation than his predecessor. Investors who followed the CEO transition knew a restructuring was likely. Whether these cuts are a one-time reset or the first step in a longer reorganisation will define how the next chapter of Disney's story reads.

Oracle signals where its ambitions lie

Oracle moved quietly on April 6 to name a new CFO, appointing Damian Maxson, who most recently served at Schneider Electric, to the role. The announcement came against the backdrop of Oracle's continuing push into AI infrastructure and cloud computing — a period in which the company's revenue and capital commitments have both grown significantly. The timing of a CFO hire tends to reflect where a company expects to be spending, and at Oracle right now, that answer is in data centres and AI. Investors paying attention to the technology infrastructure buildout will find Oracle's trajectory worth watching.

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