5 Oil Stocks You Want to Know - Barron's

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 |  Includes: CLR, EOG, MRO, STO, WLL
by: SA Eli Hoffmann

Oil prices of $100/barrel have drillers aggressively exploring North Dakota's Bakken Shale. Despite impressive recent gains, Barron's says shares of companies with stakes in the area still have upside potential.

The Bakken boom is still young, so much so that local restaurants are having a hard time hiring new staff due to the sudden surge in demand for youthful laborers. One company, Whiting Petroleum (NYSE:WLL), has dug three successful wells at Lake Robinson, the third of which is producing 2,530 b/d -- 53% more than the second. Whiting plans to drill at least 30 wells this year alone. Jefferies analyst Biju Perincheril says shares ($57) are worth $66, and that's before assigning a value to Lake Robinson.

"The newness of the [Bakken] play has analysts giving credence only to acreage that has been drilled successfully," portfolio manager David Morehead says. "We do not believe the street has fully valued the Bakken drilling that has already been permitted, let alone the Bakken acreage held in portfolios that has yet to be permitted and drilled."

Other companies with operations in the area include EOG Resources (NYSE:EOG) [11% of its assets leveraged to the area]; Brigham Exploration (BEXP) [16%]; and Continental Resources (NYSE:CLR) [33%]. Marathon Oil (NYSE:MRO) is also moving aggressively into the region.