Sterling Q2 Returns for BP Capital’s Top Stocks

#3 Superior Energy Services, Inc. (NYSE:SPN)

 – Shares Owned by BP Capital Management (as of March 31): 547,266

 – Value of Holding (as of March 31): $7.33 million

Moving on, the team at BP Capital should be patting itself on the back for having increased the fund’s stake in Superior Energy Services, Inc. (NYSE:SPN) by 33% during the first quarter, as shares of the energy service provider rose by 37.5% during the second quarter. In spite of registering solid gains this year, Superior Energy Services’ stock is still down by almost 55% over the last five years. However, a lot of analysts feel that if energy prices continue to rally through the rest of 2016, the stock can recoup a large amount of those losses. On July 15, analysts at Stephens reiterated their ‘Top Pick’ rating on the stock, while analysts at Imperial Capital upgraded the stock to ‘Outperform’ from ‘In-Line’ and also boosted their price target on it to $23 from $15. Another fund that boosted its stake in the company during the first quarter was billionaire Israel Englander‘s Millennium Management, which enlarged its holding by 107% to 2.42 million shares.

#2 RSP Permian Inc (NYSE:RSPP)

 – Shares Owned by BP Capital Management (as of March 31): 264,019

 – Value of Holding (as of March 31): $7.67 million

BP Capital initiated a stake in RSP Permian Inc (NYSE:RSPP) during the last quarter of 2015 and increased it by 18% during the January-to-March period. The oil and natural gas company focuses exclusively on the exploration and production of unconventional oil and associated liquids-rich natural gas reserves in the Permian Basin of West Texas. Earlier this year, shares of the company made their all-time low since being listed in January 2014, falling to $16.74. However, they bounced back quickly and are currently trading up by over 100% since then, partially thanks to 20.14% gains in second quarter. According to analysts, the stock could continue to perform well in the coming months as RSP Permian is among the lowest-cost exploration and production companies in the Permian and has the ability to produce strong cash flows if oil trades near or above the $50 level. With ownership of 3.5 million shares of the company, John Labanowski‘s Brenham Capital Management was the largest shareholder of RSP Permian Inc (NYSE:RSPP) in our database at the end of the first quarter.

#1 WPX Energy Inc (NYSE:WPX)

 – Shares Owned by BP Capital Management (as of March 31): 1.13 million

 – Value of Holding (as of March 31): $7.89 million

WPX Energy Inc (NYSE:WPX) was another company in which BP Capital increased its stake by 33% during the first quarter. It was also the fund’s top stock pick at the end of March. Fortuitously for the fund, it’s also the stock that has appreciated the most in 2016 out of the five top picks covered in this article, gaining 91.47%, with 33.19% of those gains coming during the second quarter. Despite such terrific gains in such a short span of time, most analysts believe that the stock will continue to outperform in the coming months. The 27 leading analysts and research firms who track WPX Energy Inc (NYSE:WPX)’s stock currently have an average rating of ‘Overweight’ and an average price target of $12.28 on it, which represents potential upside of 24%. Last month, the company announced a secondary public offering of 45 million shares with an underwriters option to purchase up to an additional 6.75 million shares in the 30-days following the commencement of the offering. WPX Energy intends to use the proceeds from this offering for general corporate purposes, which may include “an acceleration of drilling and completion activities, bolt-on acreage acquisition, and midstream infrastructure in the Delaware Basin.” WPX Energy was held by 30 of the funds in our database as of March 31, which owned 19.30% of its shares in aggregate.

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