5 Energy Stocks T. Boone Pickens Loves Right Now

Calpine

Last up is Calpine (CPN), another firm that's tangled in the web of unrequited M&A within BP Capital's portfolio. Back in 2008, NRG Energy made an unsolicited bid to buy CPN for $22.70 per share, an offer that's probably looking a whole lot more attractive now that Calpine sells for 2012 prices in the low $16 range. Calpine is another power generation firm, albeit one that jives more directly with the Pickens Plan than most - it operates modern natural gas-powered generation turbines with 28 GW of capacity between them.

Calpine's exposure to natural gas-fired plants means that the firm benefits more than most when natgas is sitting at low levels. Unfortunately for Calpine, low nat gas prices tend to go hand-in-hand with low wholesale power prices, which means that the firm's margins haven't expanded as many investors had hoped. If the company can get a handle on some of its costs - namely its debt load - it'll look like a better bet for 2012.

BP Capital bought 290,000 shares of CPN last quarter, bringing on a $5 million stake in the company.

To see the rest of T. Boone Pickens' plays check out the T. Boone Pickens - BP Capital Portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

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