Whiting Petroleum (WLL)

He thought this was going to be a great year for WTI prices – hitting $70 per barrel. There always seems to be another concern for investors. He is not sure what the unicorn is needed to change things. He would prefer to purchase high-quality Permian producers.

Has a negative view on oil. This one has a lot of torque to it and is a real whippy name, and needs higher oil prices in order to get its mojo back. Technically, in Relative Strength, this stock and the sector itself is really, really broken.

Energy started getting hit in June 2014. It got creamed in Jan/2015 when oil hit $25 a barrel. The sector bounced 75% from January last year through January this year, and then rolled over. He would say the sector is technically broken. The breadth of the percentage of stocks performing well, is contracting, meaning that money is leaving the space. Whether it is energy service, refiners or service companies, there are risks. He would be very careful.

(A Top Pick Feb 23/16. Up 180.70%.) A pure play Balkan producer that had too much debt. People had thought it was going to go bankrupt. The time to own this was a year ago. If you still own this based on his recommendation, he would sell it and roll it into Oasis Petroleum (OAS-N).

(Market Call Minute.) On the higher end of financial leverage, he would rather buy something like Enerplus (ERF-T) where you get the same product leverage, but a fraction of the debt.

The US equivalent of Baytex (BTE-T). The largest acreage holder in the US Bakken play. Because the stock fell by 75% last year and 50% this year, the equity component of the overall enterprise value has been crushed. If he is right on oil prices, the upside is huge. Also, liquidity is much better than what the market is paying them for. There are no maturities until 2018-2019, no covenant issues below the price of $30. At $40 oil, the stock is worthless, but at $45 it is worth $7, at $50 it’s worth $14, and at $55 oil it is worth around $22-$23.