T. Boone Pickens’s Latest Energy Plays: Occidental Petroleum Corporation (OXY), Marathon Oil Corporation (MRO)

Wall Street’s average price target on Range believes that a 9%-10% upside is possible from its current levels near $70 a share, while estimates for Oilwell Varco are more than twice as optimistic.

Cutting ties

Lastly, we must also mention the companies that Pickens cut ties with last quarter: EOG Resources, Inc. (NYSE:EOG), Quicksilver Resources Inc (NYSE:KWK) and Whiting Petroleum Corp (NYSE:WLL). At the end of the third quarter, these stocks represented the 4th, 11th and 12th largest holdings in the hedge fund manager’s equity portfolio, and each were new positions in the second quarter of last year.

Shares of each oil and gas company have had a decidedly different fate of late, with EOG and Whiting returning an average of 10.8% year-to-date, while Quicksilver has fallen off a cliff to the tune of -24.1% since the beginning of the year. The common thread that exists between Whiting and Quicksilver is that they’ve missed analysts’ earnings estimates in at least three consecutive quarters.

EOG did recently beat the Street’s Q4 expectations, though it’s worth asking “how much of the positive news was already discounted in the stock,” according to Simmons & Co. analysts.

With a track record like Pickens’s, it’s worth paying attention to all of his moves, and his new “fab four” may provide a great buying opportunity for those looking to gain exposure to the energy sector.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 25.4% between September 2012 and January 2013 versus 7.4% for the S&P 500 index. Try it now by clicking the link above.

Disclosure: none