To Profit From Rising Oil, Consider Shares of BP
Analysts are optimistic about the shares as well. The First Call FY2009/FY2010 earnings per share estimates for BP are $4.77 to $6.47. That $6.47 FY2010 earnings estimate will likely prove to be low. Technically, BP's chart looks beautiful -- an uptrend, and a price that continually stays above the key, 50-day moving average -- a sign that institutional investors are establishing or adding to their positions. According to my analysis, BP is headed north.
Finally, the Sell/Stop Loss has been raised to $42 from $27, or to just above the entry point; hence, this is a zero-risk trade for your March 2009-bought shares.
2010 Outlook: BP is a long-term play, but if you need to sell within the year, take your profits after it rises to $74 or if it fails to clear $75 per share.
Stock Analysis: BP is a moderate-risk stock. If you've already purchased the company's shares, hold them. If not, consider buying a 25% position in BP now; then buy another 25% in one month, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 75% of your BP position before March 2010. Revised Sell/Stop Loss if you bought shares in this company: $42.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.