Replies to post #927 on Energy (Oil & Gas) Stocks | NYSE | AMEX | NASDAQ

[Timothy Smith]

I would prefer the liquor store but will take either! :)

[Timothy Smith]

$HK JBL Energy Partners Completes Sale of Its Interest in Approximately 17,000 Acres of Prolific Woodbine Play to Halcon Resources

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=78882148

^^ $HK is a definite buy in my opinion. I have drilling going on in Leon County right now.

[Timothy Smith]

$HP Helmerich & Payne, Inc. seems to be doing pretty good going along with the demands and requirements of the oil and energy market, as evident from the Q3 FY2012 results of the company.

It recorded income from continuing operations of $150 million from operating revenues of $820 million for its third fiscal quarter ended June 30, 2012, compared to income from continuing operations of $110 million from operating revenues of $644 million during last year's third fiscal quarter ended June 30, 2011.

I would say that H&P wins hands down with its immediate competitor, Nabors Industries (NBR). The operating income margin of H&P stands at 27.62%, compared to 7.95% of NBR. The P/E ratio of H&P stands at 9.54x compared to 21.18x of NBR. Even EPS of H&P is much plumper at $4.99, compared to $0.75 of NBR.

Still the stock price of the company fell by 24.44% in the last six months.

Is it because of the lack of investor confidence or due to a factual slowdown in the economy?

As it seems, the fall in stock price is on with every other company in the oil drilling and extraction industry.

Atwood Oceanics, Inc. (ATW): -2.81%
Pioneer Energy Services (PES): -3.7%
Precision Drilling (PDS): -30.51%
Union Drilling, Inc. (UDRL): -39.75%
Patterson-UTI Energy, Inc. (PTEN): -21.67%
Unit Corp. (UNT): -13.69%

[Timothy Smith]

$VLO Valero Energy Corporation has been rising in price steadily since June 2012. Valero is up 41% in 2012. Valero unveiled plans to potentially break off its retail business from the rest of the company, the latest in a chain of energy companies slimming down assets to sharpen their focus.

Valero is working with Credit Suisse Securities to review several options for spinning off its nearly 1,000 retail stations and expects a split could be completed in six months.(See what $COP did with $PSX)

Valero reported second-quarter earnings of $831 million, or $1.50 a share, up from $744 million, or $1.30 a share, a year earlier. Revenue increased 11% to $34.66 billion. Analysts surveyed by Thomson Reuters recently expected earnings of $1.43 a share on revenue of $32.62 billion.

Valero said refining margins increased as fuel sales ticked upward throughout the U.S., offsetting rising prices for some crude oil types sold in the Gulf Coast region. Valero's refining operating income rose 8.9% as throughput volumes increased 15%. The extra barrels offset a decline in profit margin per barrel, which shrank to $10.63 from $11.41.

Valero's board recently approved a 17% dividend increase. In the past year, Valero has increased its dividend by 250%, moving toward the company's pledge to start returning cash to shareholders. Valero pays a $0.70 dividend for a current dividend yield of 2.37%.

$VLO has clear upside from here in my opinion.

[Timothy Smith]

Five Of My Top Eagle Ford Shale Oil Stocks

NuStar Energy (NYSE: NS): Spun off from Valero, NuStar is an oil transportation company that currently operates two pipelines out of Eagle Ford. Analysts have concerns about declining earnings per share and a disappointing return on equity, although that is partly due to heavy investments made in drilling infrastructure. On the other hand, cash flow is strong and revenue growth in the most recent quarter was up 40.6% year over year. And recall what CEO Anastasio said about Eagle Ford doubling its earnings. NuStar's P/E of 19.5 is lower than the industry average of 21.7. Though shares are down 6.1% so far this year to $51.89, the one-year average price target is $58.50. But perhaps the best reason to look at NuStar - a master limited partnership (MLP) -- is the dividend. It pays $4.38 for an eye-popping yield of 8.20%.

Valero Energy Corp. (NYSE: VLO): Valero's refining operations are drawing great benefit from the rapidly rising Eagle Ford output. In fact, its Houston refinery, which once imported all of its crude from West Africa, now uses only U.S. crude. Since Valero pays less for the domestic crude, the savings should drop to the bottom line. Many analysts consider VLO undervalued with a P/E of just 7.77. They also see EPS growth of 15.1% in 2012 and 14.9% in 2013. Valero has pulled back 13.6% in the past three months to $21.59, well below the $28.86 book value. The one-year target price is $30.15. VLO pays a dividend of $0.60 for a yield of 2.80%.

Murphy Oil Corp (NYSE: MUR): Murphy Oil already has 61 producing wells in the Eagle Ford. The company expects daily production to rise more than 50% this year over 2011 levels of 10,000 barrels per day. It expects to hit 48,000 barrels per day by 2015. MUR has a low P/E of 10.06 and at $46.29 is also trading below its book value of $46.97. The stock is down 27.7% since late February, partly due to recent earnings disappointments. But estimates for the current quarter have been rising. Long-term, Murphy is

Boardwalk Pipeline Partners LP (NYSE: BWP): Boardwalk, a pipeline and storage company, is a play on Eagle Ford's shale gas deposits. The company announced two deals in February with Statoil and Talisman Energy in connection with its latest Eagle Ford expansion project. BWP also had a good first quarter, with profits up 12% despite historically low natural gas prices. Boardwalk also raised its dividend for the sixth year in a row, and now pays $2.13 a share for an impressive yield of 7.80%. With a beta of just 0.51, BWP is significantly less volatile than most other energy stocks. It was trading Friday at $27.60. The one-year price target is $29.50.

Forest Oil Corp (NYSE: FST): Forest is a smallish oil and gas producer in Eagle Ford. Its $1.8 billion in debt is a bit troubling, but those investments are on the verge of paying off as production accelerates. With a market cap of just $1 billion, however, Forest Oil is a prime takeover target. Such a deal would deliver a big payoff to investors. Consider that just last week, Marathon Oil bought privately held Paloma Partners for $767 million to get 17,000 acres in Eagle Ford. Forest owns 118,000 acres in Eagle Ford in addition to large holdings in other shale oil formations in Texas and Louisiana. FST has a reasonable P/E of 9.48, but pays no dividend. The Friday price was $8.69, and the one year target is $15.58.

[Timothy Smith]

$MMR - Long term T. Boone Pickens Play

McMoRan Exploration Company, based in New Orleans, Louisiana, is engaged in the exploration, development and production of oil and natural gas in the shallow waters of the Gulf of Mexico and onshore in the Gulf Coast area of the United States.

BP Capital owns 678,421 shares, or 6.58 percent, of the portfolio. It has a market capitalization of $2.10 billion. Analysts expect MMR to hit $14.17, so at present there is certainly more room for the stock to continue its current growth.

McMoRan reported a net loss (for common stock) of $75.5 million, or $0.47 per share, for the second quarter of 2012, compared with a net loss of $50.2 million, or $0.32 per share, for the same period last year.

However, the EPS has also increased to 84.79 percent compared to the first quarter. Gross margin is showing positive results at 61.46 percent, whereas the operating and profit margins are at -1.98 percent and -1.94 percent, respectively.

MMR is an undervalued stock. With eyes set on Davy Jones, and an exploration program scheduled for one of the deepest wells in the world, MMR is poised for exponential growth.

With such high future prospects, it is easy to understand why Pickens favors these oil stocks despite interim losses. These short-term losses are of little concern to Pickens, who is invested for the long-term.

McMoRan is certainly a good long-term bet.