Nicholas Irion contributed to this article.
And as I mentioned in the first two parts, the types of trades we're looking for in these stocks are short-term pops, or drops, off of news of a storm, not as longer-term fundamentals plays, unless otherwise stated.
The companies with the highest potential for losses have assets sitting in the Gulf of Mexico corridor. These are the companies to avoid as the reason is self-explanatory -- destruction or damage of their assets. For energy companies that are focused on refining, exploration or production, every hour they are offline (i.e. not pumping, drilling, or processing oil and gas), they are losing money.Using previous storms as a template, here are companies that stand out to me for their potential negative exposure: Exploration & Production companies: This group has the most potential exposure to damage from rough weather as the cash spigot of oil and gas is turned off. It is a very simple formula -- spigot off, no revenue and bad -- spigot on, gushing revenue and good. Think of the E&P companies as the opposite trade in oil services stocks mentioned in part two of the series. On the big-cap front, watch Conoco Phillips (COP - Get Report), Devon Energy (DVN - Get Report), EOG Resources (EOG - Get Report) and Murphy Oil (MUR - Get Report).