CNBC’s Jim Cramer on Tuesday mentioned that traders bullish on oil will have to imagine making a bet on HighPeak Power.
“If you happen to imagine the cost of oil can keep increased right here, most likely since the struggle in Ukraine will turn out to be a drawn-out stalemate, then you can most likely get extra upside out of an competitive oil manufacturer like HighPeak Power,” he mentioned.
The inventory is riskier than Devon Power or Pioneer Herbal Sources because of its “large variable dividends, however in case you imagine in oil right here, that is the only for you,” he added.
One reason why HighPeak inventory is sexy is that it is reasonably affordable in comparison to its competition, in keeping with the “Mad Cash” host. The corporate inventory rose 3.94% on Tuesday to $21.88.
Cramer, who closing month inspired traders to possess an oil inventory as Russia’s invasion of Ukraine drives costs up on the pump, mentioned that HighPeak’s manufacturing ramp-up separates it from competition like Devon. CEO Rick Muncrief advised Cramer closing month that Devon is not going to build up oil manufacturing as costs crowned $100 a barrel.
HighPeak mentioned in its 2021 fourth-quarter effects that it obtained its 3rd drilling rig in October of closing yr and a fourth rig in January of this yr, including that the corporate plans to function no less than 4 drilling rigs and two frac fleets on moderate this yr.
“Maximum avid gamers on this business were loath to drill or increase as a result of they are pleased with the present established order,” Cramer mentioned. “But if everyone else is being disciplined, an organization like HighPeak Power can escape” with boosting manufacturing with out affecting crude costs, he added.
“Most likely maximum essential, they are drilling in reality aggressively on the proper time, and that point is now,” he mentioned.
Disclosure: Cramer’s Charitable Believe owns stocks of Devon Power.
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