Many oil stocks were beaten up in 2016 as oil prices continued to be depressed. However, toward the end of the year, some relief came in sight. OPEC made moves to help relieve the oil oversupply that has been keeping prices down.

Two OPEC agreements to limit production gave oil a boost over the $50-per-barrel mark. But it has dropped since then and remains stubbornly below the $50 mark. Companies that have been holding back on production may continue to do so until they can expect a reasonable return on investment (ROI). (See also: OPEC Expects Stable Oil Prices.)

These five stocks are poised to turn higher oil prices into profits. Each of these companies has been gathering assets that will produce income in 2017. They have managed to survive through efficiency measures up to now and are ready to expand if oil climbs higher in the second half of 2017. All figures are current as of August 16, 2017.

1. EOG Resources Inc.

EOG Resources (EOG) is unique in its approach to choosing drilling sites. It looks for premium sites that can produce a minimum 60% after-tax real rate of return when oil is at $50 per barrel or better. With oil below $50, the company says it can still be profitable. EOG has used the period of depressed oil prices to divest itself of non-premium sites and focus on acquiring premium ones.

EOG Resources acquired Yates Petroleum in 2016, giving it extensive acreage in the Delaware Basin, where the company can use larger rigs to increase productivity and efficiency.

The stock has been in a downward price channel since December 2016. However, revenues have risen for the four quarters, helping the company cut its income losses. Its last two quarterly reports showed positive income. The stock may have found a bottom at around $86 per share.

  • Avg. Volume: 3,378,339
  • Market Cap: $50.81 billion
  • PE Ratio (TTM): -82.62
  • EPS (TTM): -1.07
  • Dividend & Yield: 0.67 (0.75%)
  • 1y Target Est: 104.82

2. Comstock Resources Inc.

Comstock Resources (CRK), based in Frisco, Texas, may be the quietest success story in the oil patch. It had two breakouts in August 2016 and since its peak of around $13 per share last February, it has been forming a base.

The base is smooth and orderly, and if the stock completes this base, it could break out later in the year. The latest quarterly report showed increased revenues and positive operating income.

Comstock formed a joint development venture with USG Properties Haynesville on January 9, 2017, and now has access to an additional 3,315 acres that will bear 20 wells.

  • Avg. Volume: 250,463
  • Market Cap: $101.61 million
  • PE Ratio (TTM): -0.83
  • EPS (TTM): -7.92
  • Dividend & Yield: 0.00 (0.00%)
  • 1y Target Est: 10.63

3. Devon Energy Corp.

Looking at the fundamentals for Devon Energy (DVN), the company reported positive income in the past four quarters. This turn in the company’s fortunes has not helped the stock. Since December 2016, the stock has been in a downward price channel.

With the oil surplus predicted to end in late 2017, according to the Energy Information Administration, Devon could rise again. Investors can either buy into the current downtrend or wait for it to breakout.

This Oklahoma company has been in business since 1971, so it is here to stay.

  • Avg. Volume: 5,506,295
  • Market Cap: $16.33 billion
  • PE Ratio (TTM): 52.75
  • EPS (TTM): 0.59
  • Dividend & Yield: 0.24 (0.76%)
  • 1y Target Est: 42.0824 (0.78%)

4. Enterprise Products Partners LP

Enterprise Products Partners (EPD) is not a driller, it is a pipeline and storage company. It is less susceptible to the price of oil, because it has paying contracts with companies for transportation and storage of their oil.

The company also runs export docks and exports liquefied petroleum gas. EPD is no newcomer to the oil field, having been established in 1968.

The stock pulled out of a long downturn in November 2016 and rose until February 2017, when it began forming its current base.

  • Avg. Volume: 4,171,734
  • Market Cap: $55.2 billion
  • PE Ratio (TTM): 20.81
  • EPS (TTM): 1.24
  • Dividend & Yield: 1.68 (6.44%)
  • 1y Target Est: 32.58

5. Atwood Oceanics Inc.

Offshore drillers like Atwood Oceanics (ATW) were hit hard by the downturn in oil prices. The company contracts its services to put up ocean rigs, and many companies didn’t find the expense of ocean drilling attractive with oil at $40 and below.

The rise in oil prices to nearly just below $50 per barrel has put Atwood in a position to service the needs of oil companies that want offshore rigs. This company drills worldwide.

The stock rose steeply until February 2017, but then dropped. It may have found support at around $6.50 per share.

  • Avg. Volume: 6,080,130
  • Market Cap: $541.49 million
  • PE Ratio (TTM): 5.44
  • EPS (TTM): 1.24
  • Dividend & Yield: 0.00 (0.00%)
  • 1y Target Est: 9.29

The Bottom Line

Some of the smaller names in the energy sector are poised to produce exceptional gains in 2017 if oil prices rise above $50 per barrel. Watch the price of oil and perform due diligence on each of these stocks to make sure they are taking advantage of the relief from the oil oversupply. (See also: What Determines Oil Prices?)

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.