Cramer's Energy Shortage Stock Picks for 2010 (APC, CHK, XOM, XTO, DVN, SWN, APA, CLR, RRC, LINE, CVX, MRO, WPRT, CLNE)

Jim Cramer came out on CNBC’s MAD MONEY this evening with an interesting grouping of stock trends to invest in for 2010 and he thinks this is the year of active investing.  The first big trend to invest in is the coming energy shortage.  Those are his words, “an energy shortage.”  Specifically, Cramer believes in the recovery of natural gas versus oil.  He interviewed Jim Hackett, CEO of Anadarko Petroleum Corp. (NYSE: APC), and while we are skipping the details Cramer did say that he would stick with the company’s management and track record despite this having risen 19% more since his August 24 interview.

Cramer also called the deal announced today where Chesapeake Energy Corporation (NYSE: CHK) where Total SA (NYSE: TOT) will pay $2.25 billion for a 25% stake in Chesapeake’s Texas Barnett Shale.  Cramer believes this is no surprise after the recently announced deal for XTO Energy (NYSE: XTO) by Exxon Mobil Corp. (NYSE: XOM).  Other natural gas and crude E&P players Cramer touted were Devon Energy Corporation (NYSE: DVN), Southwestern Energy Co. (NYSE: SWN), Apache Corp. (NYSE: APA), Continental Resources Inc. (NYSE: CLR), and Range Resources Corp. (NYSE: RRC).  Cramer even said he still likes Linn Energy, LLC (NASDAQ: LINE) except it is up 70% and probably shouldn’t be chased.  On the integrated oil players, Cramer noted Chevron Corp. (NYSE: CVX) and Marathon Oil Corporation (NYSE: MRO) were the stocks he briefly noted.

Cramer featured a speculative stock pick for making engines that run on natural gas and alternative energies is Westport Innovations Inc. (NASDAQ: WPRT). The company lost money and is partnership-dependent, funding investments and may need to raise capital.  But the CEO, David Demers said “We need a new fuel” and the company has very deep partnerships with Cummins Inc. (NYSE: CMI) and with Volvo.  Westport makes engines for buses, class-A trucks, garbage trucks and more.  Cramer said he’d stick with this one as a fair trade, but still maintains that it is a speculative stock.

Clean Energy Fuels Corp. (NASDAQ: CLNE) was briefly mentioned as the stock play for natural gas fuel stations.  This was not mentioned for very long, but this is the T. Boone Pickens play for powering trucks on compressed natural gas.

On the natural gas plays, Cramer noted how natural gas needs more lobbying, is 30% cleaner than oil, and is 40% cleaner than coal.  He also noted how there is already 100 years worth of natural gas power already in the ground.

We have been checking the calls of many pundits for 2010 stock picking, and not just in oil and gas.  This weekend we ran a pick list covering every major financial site’s stock picks for 2010.  We have also featured the best of the DJIA 30 stocks with the most implied analyst upside for 2010.

I would like to personally invite you to join in with the thousands of readers on our free daily email distribution list from 24/7 Wall St. to hear about ongoing day trader and options trader alerts, analyst upgrades and downgrades, stock and market rumors, Buffett and guru investor news, M&A and IPOs, and more.

Jon C. Ogg
January 4, 2010

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