BofA/Merrill: Buy Oil

Energy stocks are just about in a bear market for 2017 — down by 18% based off an 11% decline in the underlying commodity. Bears point to Trump’s easy position on regulations as one of the reasons to be bearish, unleashing frackers to go hog wild throughout the country in search for crude.

BofA is out with a contrarian note today, suggesting that enough is enough and to get in the sector, you faggots, while the prices are cheap.

This from one of their equity strategists.

Source: CNBC

Subramanian told clients she now likes the laggard energy space more. “We now see significantly more upside in energy, and see limited potential for relative gains from here (forward) in consumer discretionary stocks,” she wrote.

A key pillar of Subramanian’s bullish energy call is that her firm expects the price of U.S. crude to rebound to above $70 per barrel by June.

She doesn’t see the sledding getting better for the consumer-focused stocks, however. She cites longer-term headwinds such as the “ongoing apparel malaise” and the “competitive onslaught from disruptors” in the digital retail space. Amazon.com, of course, is one such disruptor.

Some of the hardest hit stocks in the sector include $QEP, $BBG, $KEG, $SGY and $SM. You don’t have to look far to find stocks down in excess of 30% since the new year.