Hotchkis & Wiley Global Value Fund on APA Corporation
Thesis
Hotchkis & Wiley believes APA offers exposure to what it views as a structurally undersupplied global energy market. The company also generates strong free cash flow across a range of commodity-price scenarios, reducing the thesis's dependence on a single oil-price outcome. Quarterly results remained consistent with the fund's thesis even though the shares declined when oil prices retreated.
“What really excites us about APA is that it remains leveraged to a structurally undersupplied global energy market.”
Key risks
- Declining oil prices