Considering crude oil has jumped almost 17% over the last month how should you trade energy stocks?
Trader Brian Kelly likes Valero and Tesoro . “Both of those charts look fantastic and they benefit from higher prices.”
Guy Adami suggest looking at RIG which declined 6% in extended trade after the latest earnings report showed an unexpected decline in revenue, in part due to a surge in shipyard costs.
Looking at the numbers, Transocean posted a third-quarter net loss of $71 million, or 22 cents per share, compared with a profit of $368 million, or $1.15 per share, a year ago. Revenue fell 2 percent to $2.24 billion, below the average analyst estimate of $2.36 billion, according to Thomson Reuters I/B/E/S.
“Yes it was a big miss," concedes Adami, "but this is a name that's already been beaten. If you see a capitulation sell-off with big volume on Thursday, I'd pick some up toward the close.”
Elsewhere in the space, pro energy trader Joe Terranova is bullish Anadarko, Occidental , Suncor and Petrobras. "Big players want to be long oil," he says. "And they're looking at these stocks."
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Trader disclosure: On Nov 2, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Seymour is long BAC; Seymour is long INTC; Adami Owns AGU; Adami Owns C; Adami Owns GS; Adami Owns INTC; Adami Owns MSFT; Adami Owns NUE; Adami Owns BTU; Terranova is long IBM; Terranova is long AAPL; Terranova is long CF; Terranova is long AKAM; Terranova is long CNQ; Terranova is long AXP; Terranova is long MUB; Finerman owns AAPL; Finerman owns BAC; Finerman owns MSFT; Finerman owns GOOG; Finerman’s firm owns AAPL short calls; Finerman’s firm owns JPM; Finerman’s firm owns YHOO short calls; Finerman’s firm owns IBM short calls; Finerman’s firm owns MSFT; J. Najarian is long DB; J. Najarian is long CBOE; J. Najarian is long CME; J. Najarian is long CIGX; J. Najarian is long MDR; J. Najarian is long MSFT; J. Najarian is long AKAM call spreads; Stutland is short AAPL puts; Stutland is long MSFT corporate bonds; Stutland is short goog put spread; Stutland is short gld puts and long call spread; Stutland is short TLT puts; Stutland is long stock and short calls INTC; Stutland is long corporate Banking sector bonds
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