A Stock that Moves with Oil – ATPG

September 1st, 2009 | Filed under: Stock Recommendations, ,

Its hard to believe that just 1 year ago oil hit $140, now its lucky to get passed $80; however, chances are that oil will rise again. Maybe not straight to $140, but it should move higher than where it is right now. When it does will you be ready?

I have already talked about China North East Petroleum (NEP), and all the fun stuff there, but I wanted to talk about another company today, ATP Oil & Gas Corporation (ATPG).

There are couple ways we can look at this…

First, that the same management has really been intact for over 15 years so you know they are doing something right, and inside ownership is at 13% so their own money is on the line, but all that is really boring.

What I am interested in here is the potential.

When a sector is down… yeah there are some stocks that deserve to get slashed down and then there are those that just happened to be in the line of fire. The latter of the two is where I see ATPG.

The company doesn’t take too many risks and maintains efficient business practice. Best of all the chart of ATPG seems to mirror the price chart of oil.

atpg_090109

Can you see the resemblence?

wtic_090109

Not included, but it looks even freakier if you zoom out 3 years.

Now all we pretty much need to wait for is oil to head higher. As you can see in both charts, they are inching closer and closer to doing that, but right now they are still in what I like to call a range. In this situation I would like for it to breakout.

Its hard to put an exact price target on ATPG because it moves so in sync with oil, but conservatively I would say $15… although I think it could retest its 52 week high again above $20.

If you are interested to see more about this trend, see what MarketClub thinks about ATP Oil & Gas Corporation (ATPG).

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Read more on Oil, ATP Oil & Gas at Wikinvest