Zacks Top Picks - April 9

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dan_s
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Joined: Fri Apr 23, 2010 8:22 am

Zacks Top Picks - April 9

Post by dan_s »

Rosy Future for Oil Despite Concerns

On Mar 11, the IEA projected that global crude oil demand will remain firm at least up to 2024 although the rate of demand growth will decline. By this time, oil demand will rise by 7.1 million bpd (per IEA). < IEA has a long history of being too conservative on their oil demand forecasts - Dan.

Despite a surge in sales of electric car and massive oil exploration in the United States, soaring demand for oil for the petrochemical industry, especially for plastic and growing demand for aviation oil will support crude oil prices. Moreover, robust U.S. job data and manufacturing data in March as well as a rebound on China’s manufacturing PMI in March will help oil prices to remain firm in the near term. A solution to the U.S.-China trade dispute will be a major boost for the world economy.

Our Picks

At this stage, investment in stocks engaged in exploration, production, refining and marketing of oil will be lucrative. We narrowed down our search to five stocks with either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cabot Oil & Gas Corp. (NYSE:COG) an independent oil and gas company that explores, exploits, develops, produces and markets natural gas, oil, and natural gas liquids in the United States. It sports a Zacks Rank #1. The company has an expected earnings growth rate of 68.1% for the current year. The Zacks Consensus Estimate for the current year has improved 8.1% over the last 60 days.

Chaparral Energy Inc. (NYSE:CHAP) engages in the acquisition, exploration, development, production, and operation of onshore oil and natural gas properties primarily in Oklahoma. It carries a Zacks Rank #2. The company has an expected earnings growth rate of 41.9% for the current year. The Zacks Consensus Estimate for the current year has improved 214.3% over the last 60 days.

Devon Energy Corp. (NYSE:DVN) an independent energy company primarily engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States and Canada. It carries a Zacks Rank #2. The company has an expected earnings growth rate of 24% for the current year. The Zacks Consensus Estimate for the current year has improved 2.5% over the last 60 days.

NGL Energy Partners LP. (NYSE:NGL) engages in crude oil logistics, water solutions, liquids, retail propane, and refined products and renewables businesses. The company has an expected earnings growth rate of 281.5% for the current year and a Zacks Rank #1. The Zacks Consensus Estimate for the current year has improved 43.1% over the last 60 days.

Phillips 66 (NYSE:PSX) Partners LP. (NYSE:PSXP) operates, develops, and acquires crude oil, refined petroleum products, and natural gas liquids (NGL) pipelines, terminals, and other transportation and midstream assets. The company has an expected earnings growth rate of 10.3% for the current year and carries a Zacks Rank #2. The Zacks Consensus Estimate for the current year has improved 7% over the last 60 days.
Dan Steffens
Energy Prospectus Group
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