Baron Funds Comments on Helmerich & Payne Inc

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Mar 20, 2015

Helmerich & Payne, Inc. (HP) is the leading land drilling contractor in the U.S. Shares fell in the fourth quarter on investor disappointment over fiscal fourth quarter earnings and pessimism about the outlook for U.S. land drilling given the plunge in oil prices. We believe Helmerich is in a relatively better position to weather this downturn due to strong contract backlog, built-in fleet growth from existing contracts, and a bullet-proof balance sheet. We think the long-term trends of rig fleet renewal and Helmerich’s competitive advantages will re-emerge when oil prices stabilize. (Jamie Stone)

From Ron Baron (Trades, Portfolio)’s Baron Growth Fund Q4 2014 Quarterly Report.