An MLP Trio: Top Picks in the Oil Patch


Briton Ryle Image Briton Ryle Editor, The Wealth Advisory

In our MLP portfolio, we've picked solid companies that will be able to weather the storm and come out on the other side more streamlined and with less competition. So, as the price of oil keeps climbing so will the prices of our stocks, notes Brit Ryle, editor of The Wealth Advisory.

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The BP Prudhoe Bay Royalty Trust (BPT) holds overriding royalty interest in minerals in the Prudhoe Bay oil field located on the Alaska North Slope.

BPT is a pure play on the price of oil. That means as oil rises in price, so does the payment per share. There’s good reason to estimate that prices will be as high as $70 a barrel by year-end.

And that would translate into annual payments of as much as $7. BP Prudhoe Bay Royalty Trust is a “Buy” on dips under $20. The 12-month target price is $30.

Crescent Point Energy Corp. (CPG) acquires, explores, develops, and produces oil and natural gas properties in Western Canada and the U.S. Over the past five years, CPG added more oil assets than any other company in North America. Now it’s time to grow production from those new assets.

The company has a break-even point around $45 per barrel on existing resources so even with prices below $50 a barrel, it can still make money.