10 Best Oil Stocks 2012

Since the middle of July, the business headlines have been relentlessly scary as governments, corporations and individuals scramble to stay afloat in a weak global economy. Yet for airline industry executives, each day brings more good news. Oil prices are falling and look set to fall even more in coming weeks.

Crude oil was above $110 per barrel in late April, but has since fallen to about $84. Now that the crisis in Libya appears to be resolved, it should start boosting output back up to prior levels, right at a time when global oil demand may be trimmed a bit in the face of an economic slowdown. At this point, a move toward $70 oil may be in the cards as these factors play out.

10 Best Oil Stocks 2012:EQT Corporation (EQT)

 EQT Corporation, together with its subsidiaries, operates as an integrated energy company in the United States. It operates in three segments: EQT Production, EQT Midstream, and Distribution. The EQT Production segment engages in the exploration, development, and production of natural gas, natural gas liquids, and crude oil in the Appalachian Basin. This segment?s properties are located primarily in Kentucky, West Virginia, Virginia, and Pennsylvania. As of December 31, 2010, it had 5.2 trillion cubic feet of proved reserves across 3.5 million acres. The EQT Midstream segment provides gathering, processing, transmission, and storage services for the independent third parties in the Appalachian Basin. It has approximately 10,900 miles of gathering lines and 770 miles of transmission lines. The Distribution segment distributes and sells natural gas to residential, commercial, and industrial customers in southwestern Pennsylvania, West Virginia, and eastern Kentucky. It also operates a gathering system in Pennsylvania; and purchases and delivers gas to customers. This segment serves approximately 276,500 customers consisting of 257,900 residential customers, and 18,600 commercial and industrial customers. The company was formerly known as Equitable Resources, Inc. and changed its name to EQT Corporation in February 2009. EQT Corporation was founded in 1925 and is headquartered in Pittsburgh, Pennsylvania.

Advisors' Opinion:

• By Louis Navellier At 2011-11-17

  EQT Corp. (NYSE:EQT) was formerly known as Equitable Resources, Inc. and is a natural gas producer in the Appalachian Basin. Potential investors might be nervous to buy in this market, but EQT is a standout buy, up 40% in 2011.

10 Best Oil Stocks 2012:Williams Partners L.P. (WPZ)

 Williams Partners L.P. focuses on natural gas transportation, gathering, treating and processing, storage, natural gas liquid fractionation, and oil transportation activities in the United States. The company operates in two segments, Gas Pipeline, and Midstream Gas and Liquids. The Gas Pipeline segment owns and operates approximately 13,900 miles of pipelines with annual throughput of approximately 2,700 trillion British thermal units of natural gas and delivery capacity of approximately 13 million dekatherms of gas. This segment also owns interests in joint venture interstate and intrastate natural gas pipeline systems. The Midstream Gas and Liquids segment includes natural gas gathering, processing, and treating facilities; and crude oil gathering and transportation facilities that serve the producing basins in Colorado, New Mexico, Wyoming, the Gulf of Mexico, and Pennsylvania. Williams Partners GP LLC serves as the general partner of the company. Williams Partners L.P. was founded in 2005 and is based in Tulsa, Oklahoma.

Advisors' Opinion:

• By Louis Navellier At 2011-11-17

  Williams Partners (NYSE:WPZ) is an integrated natural gas company that is involved with exploration and production, midstream gathering and processing and interstate natural gas transportation. In the last nine-and-a-half months, WPZ stock has gained 18% since January 2011.

10 Best Oil Stocks 2012:Transocean Inc. (RIG)

 Transocean Ltd. provides offshore contract drilling services for oil and gas wells worldwide. It offers deepwater and harsh environment drilling, oil and gas drilling management, and drilling engineering and drilling project management services. The company also offers well and logistics services. In addition, it engages in oil and gas exploration, development, and production activities primarily in the United States offshore Louisiana and Texas, and in the United Kingdom sector of the North Sea. As of February 10, 2011, the company owned, had partial ownership interests in, and operated 138 mobile offshore drilling units, including 47 high-specification floaters, 25 midwater floaters, 9 high-specification jackups, 54 standard jackups, and 3 other rigs, as well as 1 ultra-deepwater floater and 3 high-specification jackups under construction. Transocean Ltd. was founded in 1953 and is based in Zug, Switzerland.

Advisors' Opinion:

• By John Paulson At 2011-10-6

  Transocean LTD., formerly Transocean Inc., is an international provider of offshore contract drilling services for oil and gas wells. Transocean Ltd. has a market cap of $24.06 billion; its shares were traded at around $75.41 with a P/E ratio of 13.11 and P/S ratio of 2.51. Transocean Ltd. had an annual average earnings growth of 12.7% over the past 10 years. GuruFocus rated Transocean Ltd. the business predictability rank of 2.5-star.
  
  Transocean stock has not quite recovered from the market crash of 2008, when it plunged from a $160 range to the low $40 range. As of April 25, 2011, it is selling at $73.40, with a 52-week high of $90.53. Year to date, it is up 5.6%.
  
  Paulson initiated his stake in the company in the fourth quarter of 2010. He bought 7.2 million shares at an average price of $67.17. The stock has gained 12.3% since then.
  
  Transocean owned the right that exploded in the Gulf of Mexico oil spill in April, 2010. From 2006-2009, the company earned net income of $1 billion to over $5 billion. In 2010, the year of the oil spill, it took a dramatic hit, earning $961 million in net income. In the fourth quarter of 2010, it lost $799 million in net income. Transocean had a gross profit margin of 46.5% in 2010.
  
  In April, Transocean’s ultra-deepwater drillship set the record for deepest water drill in history: 10,194 feet off the coast of India. The company will also pay the first installment of a proposed dividend of approximately $1 billion in June.

• By Brian Stoffel At 2011-10-6

  Finally, a list of energy stocks wouldn't be complete without a pure-play rig maker. Though the company took some hits for its role in the Deepwater Horizon disaster in 2010, that didn't stop Jim Mueller and Michael Olsen from adding Transocean to their portfolios.

  Jim picked the stock back in November 2010 because he thought the market's expectations for the stock were simply messed up. Using a discounted cash flow model, Jim said the stock's price "implies the company can grow [free cash flow] by just 0.7% for each of the next five years, then by 0.4% for the following five years, followed by no more growth forever."

  A quick look at history showed him what a silly assumption this was: "Over the past five years, Transocean has grown free cash flow by an average of 41.7% per year."

  Shares are 19% cheaper than they were when Jim made his original recommendation, which means expectations must be downright outrageous by now.

10 Best Oil Stocks 2012:BP p.l.c. (BP)

 BP p.l.c. provides fuel for transportation, energy for heat and light, retail services, and petrochemicals products. Its Exploration and Production segment engages in the oil and natural gas exploration, field development, and production; midstream transportation, and storage and processing; and marketing and trading of natural gas, including liquefied natural gas (LNG), and power and natural gas liquids (NGL). This segment has exploration and production activities in Angola, Azerbaijan, Canada, Egypt, Norway, Russia, Trinidad and Tobago, the United Kingdom, and the United States, as well as in Asia, Australasia, South America, North Africa, and the Middle East. This segment also owns and manages crude oil and natural gas pipelines; processing facilities and export terminals; and LNG processing and transportation, as well as NGL extraction facilities. BP p.l.c. has interests in the Trans-Alaska pipeline system, the Forties pipeline system, the Central Area transmission system pipeline, the South Caucasus Pipeline, and Baku-Tbilisi-Ceyhan pipeline, as well as in LNG plants located in Trinidad, Indonesia, and Australia. The company?s Refining and Marketing segment involves in the supply and trading, refining, manufacturing, marketing, and transportation of crude oil, petroleum, and petrochemicals products and related services to wholesale and retail customers primarily under the BP, Castrol, ARCO, and Aral brands. Its Other Businesses and Corporate segment produces and markets rolled aluminum products, as well as generates energy through wind, solar, biofuels, hydrogen, and carbon capture and storage sources; and engages in shipping activities. The company was founded in 1889 and is headquartered in London, the United Kingdom.

Advisors' Opinion:

• By Rahemtulla At 2011-10-25

  Among the stocks that Bolton favors are Spain's Telefonica (TEF), which has a 7% 2009 yield and 3.8 times dividend cover, and BP, the British oil producer, which has a 6.9% yield and 2.! 8 times cover. Falling oil prices are an issue for BP, but he thinks it will try to avoid a dividend cut, owing to bad memories of a prior cut in the 1990s.

• By Kennedy At 2011-9-28

  BP plc (NYSE:BP): Up 0.36% to $35.86. BP plc is an oil and petrochemicals company. The Company explores for and produces oil and natural gas, refines, markets, and supplies petroleum products, generates solar energy, and manufactures and markets chemicals. BP’s chemicals include terephthalic acid, acetic acid, acrylonitrile, ethylene and polyethylene.

• By Dave Friedman At 2011-9-23

  Institutional investors bought 48,831,370 shares and sold 48,563,350 shares, for a net of 268,020 shares. This net represents 0.00% of common shares outstanding. The number of shares outstanding is 18,785,912,000. The shares recently traded at $38.19 and the company’s market capitalization is $119,161,700,000.00. About the company: BP plc is an oil and petrochemicals company. The Company explores for and produces oil and natural gas, refines, markets, and supplies petroleum products, generates solar energy, and manufactures and markets chemicals. BP’s chemicals include terephthalic acid, acetic acid, acrylonitrile, ethylene and polyethylene.

10 Best Oil Stocks 2012:Exxon Mobil Corporation (XOM)

 Exxon Mobil Corporation engages in the exploration and production of crude oil and natural gas, and manufacture of petroleum products, as well as transportation and sale of crude oil, natural gas, and petroleum products. The company manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and other specialty products. As of December 31, 2010, it operated 35,691 gross and 30,494 net operated wells. The company has operations in the United States, Canada/South America, Europe, Africa, Asia, and Australia/Oceania. Exxon Mobil Corporation was founded in 1870 and is based in Irving, Texas.

Advisors' Opinion:

• By Hawkinvest At 2012-2-23

  Exxon (XOM) is a must-own stock for many oil investors. This company has a strong balance sheet and a very significant reserve base, which grows in value with the price of oil. Exxon recently reported solid results with earnings for the fourth quarter of 2011 coming in at $1.97 per share. The company also reported that it bought back about $5 billion worth of shares. Weaker margins in the refinery business did impact results, but overall, the report shows that the company is poised for a solid year ahead. Exxon has a very strong balance sheet and it can afford to continue buying back shares which will help to boost future earnings. This stock was trading for about $80 per share in December, but has been trending higher. Exxon shares have recently been finding support around $83 per share, so buying on dips at that level are particularly attractive.

   

  Here are some key points for XOM:

   

  Current share price: $86.57

  The 52 week range is $67.03 to $88.23

  Earnings estimates for 2011: $8.25 per share

  Earnings estimates for 2012: $8.99 per share

  Annual dividend: about $1.88 per share which yields about 2.2%

• By John Reese At 2012-1-11

  Again, another company that will win either way.  This is the largest company by market cap on the US stock market.  That makes them a safe haven asset when the economy is going south.  But in addition to their defensive qualities, they also have great long term prospects for growth.  They are always finding new reserves of oil.  But they are also investing in other energy sources as well like natural gas.  I think they will be a huge player in the natural gas power generation business in years to come.  I’m bullish here because I think gas will become a major player in the power generation industry in the US.  It burns cleaner than coal and safer than nuclear.

• By Dave Friedman At 2011-9-23

  Institutional investors bought 79,917,190 shares and sold 113,327,900 shares, for a net of -33,410,710 shares. This net represents 0.68% of common shares outstanding. The number of shares outstanding is 4,885,000,000. The shares recently traded at $72.64 and the company’s market capitalization is $353,184,000,000.00. About the company: Exxon Mobil Corporation operates petroleum and petrochemicals businesses on a worldwide basis. The Company’s operations include exploration and production of oil and gas, electric power generation, and coal and minerals operations. Exxon Mobil also manufactures and markets f! uels, lu bricants, and chemicals.

• By Jim Cramer At 2011-9-7

  Hmm. This is a tough one. Oil up $10 will certainly help, but the overpay of XTO Energy (XTO), a nat gas company bought when prices were so much higher, will continue to bite earnings and the company's conservative nature will make it seem plodding versus the other companies here. I don't share the appreciation many have for this company. I regard it more as a bank than an exploration and production company. That's why I see it only inching up about $5 to $78 and change, a very disappointing member of the Dow considering what is does for a living.

10 Best Oil Stocks 2012:Enbridge Inc (ENB)

 Enbridge Inc. engages in the transportation and distribution of crude oil and natural gas primarily in Canada and the United States. Its Liquids Pipelines segment operates common carrier and contract crude oil, natural gas liquids (NGLs), and refined products pipelines and terminals. The company?s Gas Distribution segment distributes natural gas to residential, commercial, and industrial customers primarily in central and eastern Ontario, northern New York State, Quebec, and New Brunswick. Enbridge?s Gas Pipelines, Processing and Energy Services segment invests in natural gas pipelines, processing and green energy projects, and commodity marketing businesses, as well as performs commodity storage, transport, and supply management services. Its Sponsored Investments segment transports crude oil and other liquid hydrocarbons through common carrier and feeder pipelines, as well as transports, gathers, processes, and markets natural gas and NGLs; operates a crude oil and liquids pipeline and gathering system; and owns a 50% interest in the Canadian portion of Alliance Pipeline and partial interests in various green energy investments. The company was formerly known as IPL Energy Inc. and changed its name to Enbridge Inc. in October 1998. Enbridge Inc. was founded in 1949 and is headquartered in Calgary, Canada.

Advisors' Opinion:

• By Louis Navellier At 2011-11-17

  Enbridge Inc. (NYSE:ENB) is an energy transportation and distribution company separated into six segments: Liquids Pipelines, Gas Distribution, Gas Pipelines, Processing and Energy Services, Sponsored Investments and Corporate. Enbridge stock has gained 13% in 2011.

10 Best Oil Stocks 2012:Anadarko Petroleum Corporation (APC)

 Anadarko Petroleum Corporation engages in the exploration and production of oil and gas properties primarily in the United States, the deepwater of the Gulf of Mexico, and Algeria. It markets natural gas, crude oil, condensate, and oil and natural gas liquids (NGLs), as well as owns and operates natural-gas gathering, processing, treating, and transportation systems. As of December 31, 2009, the company had proved reserves of 2.3 billion barrels of oil equivalent. The company also engages in the hard minerals business through non-operated joint ventures and royalty arrangements in various coal, trona (natural soda ash), and industrial mineral mines. In addition, it purchases natural gas, crude oil, condensate, and NGL volumes for resale. Anadarko Petroleum Corporation also has operations in Brazil, China, Cote d?Ivoire, Ghana, Indonesia, Mozambique, and Sierra Leone. The company was founded in 1959 and is headquartered in The Woodlands, Texas.

Advisors' Opinion:

• By John Paulson At 2011-10-6

  Anadarko Petroleum Corporation is one of the world's largest independent oil and gas exploration and production companies. Anadarko Petroleum Corp. has a market cap of $39.78 billion; its shares were traded at around $79.07 with a P/E ratio of 43.93 and P/S ratio of 3.62. The dividend yield of Anadarko Petroleum Corp. stocks is 0.46%. Anadarko Petroleum Corp. had an annual average earnings growth of 8.5% over the past 10 years.
  
  Anadarko Petroleum Corp. stock has increased 39.53% in the last five years, and 3.73% year to date. John Paulson first purchased APC stock in the third quarter of 2010, buying 13,400,000 shares at an average price of $50.39 per share. In the fourth quarter of 2010, he raised his holdings 7,877,761 shares at an average price of $64.2 per share. The stock has gained 23.2% since then. It is the fifth largest holding in his portfolio.
  
  From 2001-2008, the year of the BP oil spill, Anandarko’s earnings per year were in the billions of dollars. The company lost $40 million and $26 million in the second and third respective quarters of 2010, for a 2010 net income of $761 million, up from a loss of $103 million the year prior.
  
  In guru Daniel Loeb’s third quarter 2010 letter to investors, he wrote that Anadarko was a minority nonoperating partner in the Macondo Well and that the well’s explosion was responsible for Anadarko’s share price decline from ~$73 to a low of ~$35. He also acquired millions of shares in the third quarter of 2010, commenting: “We initiated a position in the debt securities in June and July of 2010 at yields to maturity of 8 to 9.5%, expecting all-in returns via interest and capital appreciation of 20 to 30% based on the view that the market overreacted to the impact of the spill and potential liabilities. We believed that investors were ignoring the long duration of the cash outflows related to spill liabilities (NPV effect) as well as the tax deductibility of those expenses. Our analysis suggested that the “worst-case” liability figures for BP included punitive damages and criminal fines that Anadarko would not be required to share in any scenario, and Anadarko will likely not have to pay its 25% share of the liabilities due to a finding of gross negligence on the part of BP or, more plausibly, a settlement with BP (a scenario with potent political tailwinds). Finally, we knew the Company’s intent is to be an investment grade company, and so regardless of the ultimate liability, the Company would take actions (equity raises, asset sales, Capex reductions) to re-attain investment grade status.”
  
  However, Moody’s analysts recently reported, "A quick look at the five Macondo companies in the year since the accident reveals that legal matters remain far from certain for BP, Anadarko and Transocean."

• By Sam Collins At 2011-9-11

  Anadarko Petroleum Corporation (NYSE: APC), a major oil and gas exploration and production company, with operations primarily in the United States, the deepwater of the Gulf of Mexico and Algeria, is in a bull market that began in October 2008. Last year was spent retracing a breakdown that occurred in April. But in December, amid rumors that BHP Billiton (NYSE: BHP) had its sights on APC after failing to acquire Potash Corp. (NYSE: POT), the stock broke out on a huge breakaway gap from a major bottom “V.” Breakaway gaps need not be retraced (covered), so APC may have another major move up from it.

  The rumors have not been confirmed, but based on the current price, the stock is still worth purchasing as a play on the continuing increase in the price of crude oil. Anadarko’s earnings for Q4 are expected to rise more than fivefold, according to Thomson Reuters. Technically, the breakout has a target of $90-plus. S&P rates APC a “five-star buy” with a target of $140. Buy now for a trade to $100 or for a long-term target of $130-plus.

10 Best Oil Stocks 2012:Whiting Petroleum Corporation (WLL)

 Whiting Petroleum Corporation engages in the acquisition, development, exploitation, exploration, and production of oil and gas primarily in the Permian Basin, Rocky Mountains, Mid-Continent, Gulf Coast, and Michigan regions of the United States. As of December 31, 2010, its estimated proved reserves were 304.9 million barrels equivalent of oil; and had interests in 9,698 gross productive wells covering approximately 1,115,000 gross developed acres. The company sells its oil and gas to end users, marketers, and other purchasers. Whiting Petroleum Corporation was founded in 1983 and is Denver, Colorado.

10 Best Oil Stocks 2012:Range Resources Corporation (RRC)

 Range Resources Corporation, an independent natural gas company, engages in the acquisition, exploration, and development of natural gas properties primarily in the Appalachian and southwestern regions of the United States. The company?s Appalachian region drilling and producing activities include tight-gas, shale, coal bed methane, and conventional natural gas and oil production in Pennsylvania, Virginia, Ohio, and West Virginia. It owns 4,969 net producing wells, approximately 2,750 miles of gas gathering lines, and approximately 1.8 million gross acres under lease. The company?s Southwestern drilling and producing activities cover the Barnett Shale of North Texas, the Permian Basin of West Texas and eastern New Mexico, the East Texas Basin, the Texas Panhandle, and the Anadarko Basin of Western Oklahoma. It owns 1,954 net producing wells, as well as approximately 886,000 gross acres under lease. As of December 31, 2010, Range Resources Corporation had had 4.4 Tcfe of proved reserves. It sells gas to utilities, marketing companies, and industrial users. The company was formerly known as Lomak Petroleum, Inc. and changed its name to Range Resources Corporation in 1998. Range Resources Corporation was founded in 1975 and is headquartered in Fort Worth, Texas.

Advisors' Opinion:

• By Louis Navellier At 2011-11-17

  Range Resources Corp. (NYSE:RRC) is an independent natural gas and oil company that explores, develops and acquires primarily natural gas and oil properties in the U.S. This is another stock that is up big, gaining 46% year to date.

10 Best Oil Stocks 2012:Weatherford International Ltd (WFT)

 Weatherford International Ltd. provides equipment and services used in the drilling, evaluation, completion, production, and intervention of oil and natural gas wells to independent oil and natural gas producing companies worldwide. It offers artificial lift systems, which include progressing cavity pumps, reciprocating rod lift systems, gas lift systems, hydraulic lift systems, plunger lift systems, hybrid lift systems, and wellhead systems, as well as production and well optimization systems, multiphase metering systems, and production control system. The company also provides tubular running services, cementing products, liner systems, swellable products, solid tubular expandable technologies, and aluminum alloy tubular products. In addition, it designs and manufactures drilling jars, rotating control devices, and other pressure-control equipment used in drilling oil and natural gas wells; and offers a selection of in-house or third-party manufactured equipment for the drilling, completion, and work over of oil and natural gas wells for operators and drilling contractors, as well as a line of completion tools and sand screens. Further, the company provides wireline and evaluation services; re-entry, fishing, and thru-tubing services, as well as well abandonment and wellbore cleaning services; stimulation and chemicals, including fracturing and coiled tubing technologies, cement services, chemical systems, and drilling fluids; integrated drilling services; and pipeline and specialty services. The company was founded in 1972 and is headquartered in Geneva, Switzerland.

Advisors' Opinion:

• By Tom Bishop At 2011-12-9

  Weatherfor! d Intern ational (WFT) is trading around $14. Weatherford is a leading provider of equipment and services to the oil and gas industry, based in Switzerland. These shares have traded in a range between $10.85 to $26.25 in the last 52 weeks. The 50-day moving average is $15.46 and the 200-day moving average is $19.62. WFT is estimated to earn about 88 cents per share in 2011 and $1.67 for 2012. Analysts at UBS set a $28 price target for WFT share.

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