Oil hit a record high of $90 per barrel last week, and many experts think it’s going to hit $100 in the next year – in fact, Goldman Sachs recently made a bold call that oil could spike as high as $135 per barrel.
While it eased to $88.60 on Friday, we are all being forced to dig deeper to gas up our cars, to fly to warm vacation locales, to heat our homes – and even to put food on the table.
We’re all paying these higher prices, whether through the cost of gas, heating bills, or the price of a plane ticket. But you may be able to turn the tables on high oil prices. Instead of letting oil prices pinch your wallet, invest in stocks that stand to profit from expensive oil.
Here are four companies worth checking out:
Apache Corp. (APA): Houston-based Apache has made serious profits by buying unwanted land from big oil companies, and finding new reserves. Natural gas represents 53 percent of Apache’s production while oil is 47 percent – a balance that provides upside and a hedge against price fluctuations in these two businesses. My 12-month price target is $120.
BJ Services (BJS): This company offers specialized drilling services – the kind of services that are increasingly in demand as oil corporations move beyond the easier reserves and need to resort to more intensive and complicated methods to find more oil.
It’s currently trading around $26, close to the bottom of its 52-week range. Look for BJ Services to hit $32 in the next 12 months.
Sunpower Corp. (SPWR): Sunpower’s stock price is rocking to higher highs as businesses and individuals are trying to control energy costs, hedge against rising electricity rates and be socially responsible citizens. Target 12-month price target is $135.
FPL Group (FPL): FPL, a Florida utility, is also in the vanguard of power companies using renewable energy, and has invested heavily in wind, solar, and waste to energy. $90 is my price target for the next twelve months.