With low oil, how to play energy: Pro

With oil prices expected to remain low well into this year, energy investors should focus on companies that show good upside while factoring in current commodity prices, Capital One Securities energy analyst Richard Tullis told CNBC on Friday.

Slowing demand as well as surging production in the United States have sent oil prices plummeting and slammed the energy sector.

"You want to look for companies that have good balance sheets going into this downturn that could still generate good production growth and have liquidity to fund any expected outspend," he said in an interview with "Street Signs."

Read MoreLow oil good for Americans, not global growth: Pro

For Tullis, certain names fit the bill.

In the mid-cap space, he likes Concho Resources and Newfield Exploration which he said have a lot of liquidity and should generate at least 10 percent production growth.

His small-cap picks are Diamondback Energy and Jones Energy.

Both companies are expected to show production growth of 40 to 100 percent for 2014 and better than 40 percent for 2015, Tullis said.

"Both have adequate liquidity and are going into this downturn with good balance sheets," he said.

Read MoreNew year, new oil industry hurdles in 2015

Disclosures: Capital One Securities Inc. has received compensation for investment banking services from Concho Resources Inc., Diamondback Energy Inc. and Jones Energy Inc. within the last 12 months. Capital One Securities Inc. has managed or co-managed a public offering of securities for Concho Resources Inc., Diamondback Energy Inc. and Jones Energy Inc. within the past 12 months. Neither Capital One Securities Inc. nor Tullis have any position with NFX.