As the Dow Jones Industrial Average pushed above the 18,000 level on Tuesday for the first time since April, energy stocks led the way. A combination of U.S. dollar weakness, persistent strength in crude oil futures and the promise of a delayed interest rate hike from the Federal Reserve (thanks to Friday’s disappointing jobs report) have all played a role.
The Energy Select SPDR (XLE) has broken up and out of a three-month narrowing pennant formation, bursting over its April high and setting up a return to the early November high near $70.
Oil services plays in particular are leading the way in impressive fashion: The Market Vectors Oil Services ETF (OIH) gained 7.2% on Monday for its best one-day gain since the rebound out of last August’s market low and is up another 1.8% in mid-day trading on Tuesday.
The OIH has now returned to its late 2015 trading range, up about 50% from its January lows, but still down about 45% from its summer 2014 highs (before the epic energy price meltdown).
For investors looking to get in on the action, consider these nine names.
Oil and Gas Stocks to Buy: Chevron Corporation (CVX)
After an impressive gain of a third from its January low, Chevron (CVX) shares have surged up and out of a tight three-month consolidation near the $100-a-share level since late April.
Next resistance levels are near $107.50, the late 2014/early 2015 highs.
The company will next report results on July 29, before the bell. Analysts are looking for revenues of 24 cents per share on revenues of $25.8 billion.
Oil and Gas Stocks to Buy: Baker Hughes Incorporated (BHI)
Shares of oilfield services provider Baker Hughes (BHI) have surged up and over their 200-day moving average for the first time since early 2015 posting a rebound of nearly a third off if its lows from earlier in the year.
The company was the focus of a recently cancelled M&A deal with Halliburton Company (HAL).
The company will next report results on July 27 before the bell. Analysts are looking for a loss of 58 cents per share on revenues of $2.4 billion.
Oil and Gas Stocks to Buy: BP plc (ADR) (BP)
BP plc (BP) shares are looking ready for an upside breakout above year-long resistance near $33-34, which would return the stock to levels not seen since last summer.
Back in April, management expressed a belief that the crude oil market would move into balance by the end of the year as they continue to focus on cost control.
The company will next report results on July 26 before the bell. Analysts are looking for earnings of 24 cents per share on revenues of $45 billion.
Oil and Gas Stocks to Buy: Chesapeake Energy Corporation (CHK)
Chesapeake Energy (CHK) shares are bouncing off of trendline support going back to its February low. Watch for another test of its 200-day moving average as the five-month uptrend rolls on.
A rally back to $10 would be worth more than a double from here and return the stock to early 2015 levels.
The company will next report results on Aug. 3 before the bell. Analysts are looking for a loss of 11 cents per share on revenues of $1.91 billion.
Oil and Gas Stocks to Buy: ConocoPhillips (COP)
On Tuesday, ConocoPhillips (COP) shares blasted out of a narrow, two-month consolidation range between its 200-day and 50-day moving averages.
The late-April high near $49 is the next hurdle before the bulls can take a shot at the early November highs near $56. That would be worth a 20% gain from current levels.
The company will next report results on July 28 before the bell. Analysts are looking for a loss of 67 cents per share on revenues of $6.7 billion.
Oil and Gas Stocks to Buy: Hess Corp. (HES)
Hess Corp. (HES) shares look ready to break up and out of a narrowing three-month pennant formation that’s capped a powerful rally out of its January low.
There is a lot of resistance near the $62.50 level, tracing back to last September.
The company will next report results on July 27 before the bell. Analysts are looking for a loss of $1.33 per share on revenues of $1.1 billion.
Oil and Gas Stocks to Buy: Marathon Petroleum Corp (MPC)
Marathon Petroleum (MPC) remains mired in a four-month consolidation range between $37.50 and $35. If energy sector strength continues, watch for a breakout above its 200-day moving average and a possible run at its late 2015 highs in the $50s.
The company will next report results on July 28 before the bell. Analysts are looking for earnings of $1.32 per share on revenues of $15.48 billion.
Oil and Gas Stocks to Buy: Nabors Industries Ltd. (NBR)
Nabors Industries (NBR) shares look ready to jump their April high near $11, setting up a run at its October high near $12 and a possible test of its 200-week moving average not tested since last spring.
The company will next report results on August 2 after the bell. Analysts are looking for a loss of 47 cents per share on revenues of $495.5 billion.
Oil and Gas Stocks to Buy: National Oilwell Varco, Inc. (NOV)
National Oilwell Varco (NOV) shares have broken up and out of a tight two-month range to test its late April high.
As a result, shares of broken up and over its 50-week moving average for the first time since September 2014, indicating a possible end to a three-year downtrend.
The company will next report results on July 28 before the bell. Analysts are looking for a loss of 32 cents per share on revenues of $1.8 billion.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.
