NEW YORK (Real Money) -- When I first got into journalism we were being schooled by Woodward & Bernstein to follow the money. It was always the money trail that got you to what was really happening.
In the stock market you can do the exact same thing when you look at the money.
Right now I am following the money in oil and gas, and it keeps leading me to the places that make the most sense to invest. Just take last night's "Mad Money."
How GM Could Spin Off a $400 Billion Business Ostensibly, I had no oil companies on last night. That's pretty unusual, as I have tried to introduce people to all the best oil and oil-related plays I can find, from Cheniere Energy (LNG) to Access Midstream Partners (ACMP) to Halliburton (HAL) to Anadarko (APC), Apache (APA), Carrizo (CRZO), EOG Resources (EOG) and so many others. The performance of all of these companies continues to astound, as we saw yesterday when Cheniere signed a startlingly exciting 20-year agreement with Woodside Petroleum from Australia. This was a total shocker; Woodside is supposed to be the king of LNG and here it is, buying from little Cheniere. Last night, however, I featured three odd beneficiaries of the oil and gas renaissance simply because I followed the money. First, the one most abundant material on earth may be sand. Silica is widely hailed as a material that has almost no cost. Which is why it is amazing to listen to the story of Emerge Energy (EMES), a company that makes the right kind of sand for fracking. Believe me, there is only one kind of sand that the oil drilling companies want: the Wisconsin sand that Emerge owns. Now, the first reaction you will have to Emerge is: "Don't be ridiculous, there is nothing proprietary about sand." Then you look at the stock price, which has gone from $20 to $105 in a year, and you start to think differently. Then you dig deeper and you see a company that simply cannot keep up with the demand. I am confident this company will top estimates next year simply because it can write its own ticket. Have we missed it? It's pretty much like EOG or Continental (CLR) or Pioneer (PES); we missed a lot, but there's probably more.
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