More from this Author
- July 5, 2011
- June 30, 2011
Gas prices have been a hot topic this year. Every time I go to the pump, I find myself driving in circles, through traffic, to find the best price…
Luckily, I don’t have to do that very often. Living in a city allows me to walk most places.
Lets just say, it adds up.
But what if there was a way to profit from rising price in oil? A way to hedge against the money you are paying at the pump?
A couple of weeks ago, Byron King joined us to tell us about the best way to profit from exploding oil prices.
With the events we’re seeing in the Middle East I don’t think we’re far from a super spike in the price of oil.
And if that’s the case, you’ll want to take a look at the oil that offer you a chance to profit from a general rise in the price per barrel. Plus, plays that are out of the “danger zone” and won’t be affected by Middle East turmoil. This way you’ll have the opportunity to profit from oils next leap higher.
(If you missed it, you can find the full article here.)
Here at the Sleuth, we provided you with 3 small-cap oil companies that are out of the “danger zone.”
* ATP Oil and Gas Corp. (NASDAQ:ATPG)
* Kodiak Oil and Gas Corp. (NYSE:KOG)
* Vantage Drilling Company (AMEX:VTG)
Today let’s take a closer look at these three companies…
ATP Oil and Gas Corp. — ATP is an international company that works on the acquisition, development and production of oil and natural gas. They create value for their shareholders through the acquisition and development of significant underdeveloped reserves. Their reserves are located in the Gulf of Mexico, the United Kingdom, and the Dutch sectors of the North Sea.
While they are smaller than many of their competitors, they are invested in new technology. Staying on the cutting edge is a great way to end up on top when other companies start to fall behind.
Better yet? There has been a significant amount of insider buying over the past few months…
If you remember awhile ago, I wrote about the importance of insider buying. (If you missed it, click here.) Insiders will sell their company’s shares for any number of reasons—but normally only pick up shares for one.
They think the stock will go up.
Now may be a great chance to pick up shares for cheap.
Kodiak Oil and Gas Corp.— When we first mentioned Kodiak, it was listed on the American Stock Exchange (AMEX). Kodiak recently changed it’s listing to the New York Stock Exchange (NYSE).
Kodiak is an oil company that works on the exploration, acquisition, and productions of oil and natural gas. They have a oil and natural gas portfolio in proven U.S. reserves.
And—they are also working on the speculation of new reserves.
Kodiak is highly competitive with other companies in the industry and with showing substantial revenue growth. This could also be a good addition to your small-cap resource portfolio.
Vantage Drilling Company— Vantage Drilling is a provider of offshore contract drilling services for oil. They are focused on operating a fleet of drilling unit.
While the company is not turning a profit yet, they are showing revenue growth. They are smaller than many of their competitors, but in line with industry standards.
This would probably be the riskiest play of the three, but not necessarily a bad buy. Like ATP, insiders have been buying up shares for the last couple of months.
And the stock is trading at just under $1.50.
As you can see, there is a lot of opportunity in small-cap oil companies right now. But just one reminder: the Sleuth does not keep a model portfolio. We will not be sending out buy or sell alerts on these companies. If you do decide to invest in any of these oil plays, be sure to plan your entry and exit carefully.
– Jessica ComittoSource: Penny Sleuth