April 21st, 2008

Late Blooming Energy and Ag: ACI, MMR, ADM, SFY, CRK and PXD

Are you looking for a stock that hasn’t yet run away from reach in the current “commodities speculative bubble” among the Energy, Materials, Ag Chemical, Steel or other Industry Groups? Here are a couple that are beneficiaries of the “a rising tide lifts all boats” phenomena as they’re all just moving into New High or 4-year New High territory after frequently stalling out at long overhead resistance trendlines (you can view their charts by clicking on the symbol; note scales may vary):

  • ACI (Arch Coal)
  • MMR (Mcmoran Exploration)
  • SGY (Stone Energy Corp)
  • ADM (Archer Daniels Midland)
  • SFY (Swift Energy)
  • PXD (Pioneer Natural Resources)
  • CRK (Comstock Resources)

Some of you out there probably had the guts to throw away the old rules about diversifying your portfolio and put all, or most, of your eggs in the energy basket back in 2002-04 when this oil and gas boom started ….. and stayed with it through this rocket ride (if there are, I’d love to hear from you and how the experience was; if you allow, I’d love to share some of the excitement you’ve had with other readers).

I’ve been kicking myself, over and over, since I saw it forming and have been writing about it for over 3 years. I’ve owned , off and on for a period, many of the names we recognize as today’s leaders since it all began. I’ve owned POT, MOS, APA, APC, BRY ….. on the list goes on forever.

But the only thing it proves is that it’s relatively easy to pick stocks, the hard part is knowing when to sell them …. or knowing when not to sell them. All the so-called experts send out mixed messages. On the one hand they say “hold on to and even build on your winners”. But on the other hand they say “sell when you get a 25-50% profit” or “sell half and play with the houses money” or “schnitzel a little” whatever that means.

But the big money’s made in booms and bubbles, whether it’s in tech, housing, oil & gas, or commodities. We’re all fearful that having been lucky enough to get in the game early, we’re going to be too late getting out. In truth, you only get hurt badly when you’re late getting in.

So for now, let’s be patient because there will be another bubble (perhaps a re-emergence of technology, biotech, medical products or drugs). This time, I’m promising myself, I’ll get in, stay in and ride it all the way.

Caution: If you buy any of the above, don’t wait for me to tell you when to sell …. I either will be on to recommending to you the next boom/bubble or just won’t have the foggiest idea myself.

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