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Brian Bolan is the aggressive growth stock strategist at Zacks Investment Research and this week he is drilling into the oil patch. The price of crude has been moving up over the last several weeks and we take a look at the macro factors that have been pushing oil higher.
Geopolitical concerns our first and foremost pushing prices higher as the war in Ukraine rages for more than two years and tensions in the Middle East have soared. A lot of investors are positioning themselves in oil stocks in expectation of an Iranian retaliatory strike on Israel. Another factor causing oil prices to move higher is that the summer driving season is right around the corner and airfares are still very high.
On a longer tail demand idea is the strategic petroleum reserve that was depleted a few years ago and needs to be replenished. This idea is one that there is going to be a buyer at lower prices so that acts as a support mechanism for the price of oil.
Brian takes a look at three stocks in the oil patch and goes from one of the biggest all the way down to a very small cap stock.
Exxon Mobil (XOM - Free Report) is a Zacks rank #3 (Hold) and is one of the largest oil plays out there with a market cap of $475B. Brian highlights that the company beat earnings back at the beginning of February and is likely a Zacks rank #3 right now as the window of opportunity for estimate revisions has likely closed Exxon Mobil (XOM - Free Report) . Analysts that cover the large cap oil companies we'll often update their earnings models the day after the earnings release, but the window of opportunity for the Zacks Rank is only 60 days and we are likely just past that point.
Crescent Point Energy (CPG - Free Report) is a Zacks Rank #2 (Buy) even after missing estimates when they reported back at the end of February. At $5.46B in market capitalization, some would say that this is a mid-cap or a “smallish mid-cap” which is often called a SMID-cap. Crescent Point Energy (CPG - Free Report) is expected to see 5.5% topline growth this year and then that number accelerates to 7.1% in 2025.
Brian drills deep for an opportunity that just might be a geyser for investors. Prairie Operating Co (PROP - Free Report) is a Zacks Rank #3 (Hold) and is very small at just over $100M in market capitalization. The company is expected to start production in the second quarter of this year and generate $88M in sales. That number gushes higher to $274M in 2025 for a 211% growth rate.
Oil stocks can be found in a number of the Zacks portfolios. Right now there are 3 of them in the Home Run Portfolio but any of the editors could be buyers in the near future and the best way to stay abreast of all the changes is through a subscription to Zacks Ultimate. A Zacks Ultimate subscription will give you access to all the portfolio’s and a daily email summarizes any of the changes made to them.
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Brian's Big Idea on Oil
Brian Bolan is the aggressive growth stock strategist at Zacks Investment Research and this week he is drilling into the oil patch. The price of crude has been moving up over the last several weeks and we take a look at the macro factors that have been pushing oil higher.
Geopolitical concerns our first and foremost pushing prices higher as the war in Ukraine rages for more than two years and tensions in the Middle East have soared. A lot of investors are positioning themselves in oil stocks in expectation of an Iranian retaliatory strike on Israel. Another factor causing oil prices to move higher is that the summer driving season is right around the corner and airfares are still very high.
On a longer tail demand idea is the strategic petroleum reserve that was depleted a few years ago and needs to be replenished. This idea is one that there is going to be a buyer at lower prices so that acts as a support mechanism for the price of oil.
Brian takes a look at three stocks in the oil patch and goes from one of the biggest all the way down to a very small cap stock.
Exxon Mobil (XOM - Free Report) is a Zacks rank #3 (Hold) and is one of the largest oil plays out there with a market cap of $475B. Brian highlights that the company beat earnings back at the beginning of February and is likely a Zacks rank #3 right now as the window of opportunity for estimate revisions has likely closed Exxon Mobil (XOM - Free Report) . Analysts that cover the large cap oil companies we'll often update their earnings models the day after the earnings release, but the window of opportunity for the Zacks Rank is only 60 days and we are likely just past that point.
Crescent Point Energy (CPG - Free Report) is a Zacks Rank #2 (Buy) even after missing estimates when they reported back at the end of February. At $5.46B in market capitalization, some would say that this is a mid-cap or a “smallish mid-cap” which is often called a SMID-cap. Crescent Point Energy (CPG - Free Report) is expected to see 5.5% topline growth this year and then that number accelerates to 7.1% in 2025.
Brian drills deep for an opportunity that just might be a geyser for investors. Prairie Operating Co (PROP - Free Report) is a Zacks Rank #3 (Hold) and is very small at just over $100M in market capitalization. The company is expected to start production in the second quarter of this year and generate $88M in sales. That number gushes higher to $274M in 2025 for a 211% growth rate.
Oil stocks can be found in a number of the Zacks portfolios. Right now there are 3 of them in the Home Run Portfolio but any of the editors could be buyers in the near future and the best way to stay abreast of all the changes is through a subscription to Zacks Ultimate. A Zacks Ultimate subscription will give you access to all the portfolio’s and a daily email summarizes any of the changes made to them.