Shares of companies specializing in refining gasoline and selling it via gas stations have proven to be one of the best ways to profit by the plunge in crude oil prices.
Gasoline retailers earn their widest profit margins when they can buy crude oil, their main raw material, as cheaply as possible.
The development is quite interesting because over the past few years, when oil prices were rising, large integrated energy conglomerates like ConocoPhillips, Marathon Petroleum and Murphy Oil, spun off their gas station businesses because they were growing too slowly for inpatient investors.
Now however it's the gas stations' time to shine, and they are outperforming their former parents by an order of magnitude.
Our top bet in this industry is Murphy USA, which was spun off from Murphy Oil in August 2013. At that time, I listed it as one of my top picks for the coming year during a MoneyShow panel in San Francisco. Since then, it has been one of the top picks of the StrataGem system at our Strategic Advantage service. Click here for one of our posts about the refiners from early December last year that appeared on our Yahoo! Finance blog.
Our system still likes MUSA for both fundamental and technical reasons -- it's growing fast, profit margins are widening and the stock is under accumulation;.