Stock Picks: Good Time for Oil Refiners
Tumbling oil prices should send investors toward the people who own and run refineries, according to SmartMoney senior markets editor Russell Pearlman.
"These guys got slaughtered recently, because they hadn't been able to raise prices fast enough on gasoline to make up for the difference in the increased cost of their feed stock," Pearlman told CNBC. "You've seen oil prices go down here 11 percent, but the price of gas has only gone down about 3 percent."
He says recent price moves will help refiners recapture their pricing power and margins.
"The stocks are certainly cheap enough, particularly Valero and Tesoro," he said.
"You have a lot of the downside already baked into the guys with P/Es of less than 10."
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Disclosure information for Russell Pearlman was not immediately available.