The price of oil has once again begun to move higher due to unrest in Libya. Many investors are starting to pay closer attention to energy stocks and within this category are a small number of stocks that trade at less than $10 per share. Investors love to buy "cheap" stocks, so here is a list of five strong energy stocks currently trading under the $10 watermark. Midwest Oil
Kodiak Oil & Gas Corp (NYSE:KOG) is an independent oil & natural gas company that has acreage in the Williston Basin and Green River Basin located in the north Midwest. The land explored gives the company access to the larger and better-known Bakken Basin that is highly sought after. The company has a forward P/E ratio of 17.26 and is trading at the best level in its history. A move higher is reasonable given the global economic conditions.
Bullish Energy
FX Energy (Nasdaq: FXEN) is a U.S.-based company that has its principal exploration and production facilities in the Rotliegend sandstones in Poland. The company also has smaller acreage in Montana and Nevada. FXEN trades with a forward P/E ratio of 37 and has had an impressive rally over the past several months. The stock price is currently hovering around the $10 mark, which makes it an interesting candidate for an energy investor's watchlist. (For more, see Oil And Gas Industry Primer.)
Tapping Mountain Resources
Warren Resources (Nasdaq:WRES) is an independent energy company that primarily develops coalbed methane and natural gas properties in the Rocky Mountain region. The stock trades with a forward P/E ratio of 21 and recently from its high of $6.16 on heavy volutme. There is strong support in the $4 area and no significant resistance, until it gets to the double-digit area.
Energy Overseas
Vaalco Energy (NYSE:EGY) is an energy company that acts as an operator of consortiums internationally in Gabon and Angola as well as minor interests in the Gulf Coast area. The stock has a very low forward P/E ratio of 12 and technically is trading in a consolidation pattern after a big rally in November. The big time resistance is near $10 where the stock hit an all-time high in 2006.
Most Attractive
Gran Tierra Energy (NYSE: GTE) is a Canadian independent energy company that explores for and produces oil and natural gas in Colombia, Argentina, and Peru. The company trades with a forward P/E ratio of 19 and has been steadily climbing higher since July. The chart pattern is very strong and the exposure to the Latin American emerging markets is also a bonus. (For more, see Going International)
The Bottom Line
All five stocks are considered aggressive investments due to their stock price as well as their volatility. The good news is that all companies are expected to be profitable in the coming year, which lower some of the potential downside.
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