I had been bearish on the global economy for years. I surmised that perpetual stimulus and zero interest rates designed to prop up asset prices were good for assets like equities and real estate. However, it was not necessarily good for the economy. When the stimulus ended the economy would likely falter. That sounded foreboding for cyclical names like Weatherford International (OTCPK:WFTLF) or other energy-related names.
After the Financial Crisis of 2008 Weatherford went on a buying spree to take advantage of runaway oil prices. When oil prices plateaued, Weatherford stuck with billions in debt. In 2018 I suggested Weatherford too much leverage and the stock was worthless. I also chronicled the company’s Chapter 11 bankruptcy. Weatherford has returned from bankruptcy with less debt and a cleaner balance sheet and improved business prospects. The company could have an overhang based on past performance. Once the overhang is removed Weatherford will bounce. Weatherford is a 3-bagger. Read more: