Drawn to the Drillers

 | Jun 20, 2014 | 4:18 PM EDT  | Comments
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I have not seen this kind of sustained move in the oils since the early 1980s, when there were oil takeovers pretty much every single week.

Now some of it is certainly the price of crude, which has been up huge because of Iraq. But a lot of it is the organic growth that these companies are exhibiting, much of it accelerating as they begin to drill more holes in tighter spaces.

Even after these runs I am still attracted to Anadarko (APC), Apache (APA), EOG (EOG), Pioneer (PXD), Cimarex (XEC), Continental (CLR), Noble Energy (NBL) and Carrizo (CRZO) because I think, in every case, numbers are too low. I still like Occidental (OXY) for its upcoming restructuring and Marathon Oil (MRO) for its takeout value.

The major oil-services stocks all still have the possibility of further appreciation but I am drawn to the drillers, notably Ensco (ESV) and the boutique specialty plays, notably Basic Energy (BAS) and, at these prices, Core Labs (CLB).

These are becoming the stocks to own into the end of the quarter. I like them both for trades and investments.

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