OK, I admit it. I’ve been walking around singing the theme song from the old TV show The Beverly Hillbillies. Now bear with me for a moment, because this actually does make a little bit of sense!

Come and listen to a story about a man named Jed
A poor mountaineer, barely kept his family fed.
Then one day he was shootin’ at some food,
And up through the ground came a bubblin’ crude.
Oil that is. Black gold. Texas tea.

With oil now priced at nearly $140 a barrel, everyone is talking about black gold. That is a lot of money for a 55-gallon container! It's even more incredible when you realize the price has doubled over the past 12 months, affecting everything from gas prices to food prices.

As is the case with anything when prices are out of control – remember Internet stocks? the housing market? – a lot of folks want to jump on the bandwagon to get rich. They think playing oil is the way to go. After all, that’s what happened to Jed:

Well the first thing you know ol’ Jed’s a millionaire,
Kinfolk said Jed move away from there.
Said Californy is the place you ought to be
So they loaded up the truck and moved to Beverly… Hills, that is.

Jed may have lucked out and struck it rich with oil, but I’m here to tell you that you’re not going to get rich that way – at least not in oil stocks.

Eye-Popping Numbers

I know that sounds crazy, especially when you dig into the mind-blowing numbers. The combined market value of the three biggest oil companies traded on the New York Stock Exchange – ExxonMobil (XOM), Chevron (CVX) and BP (BP) – is nearly $900 billion. For some perspective, that’s the size of a small nation like Estonia!

The numbers are even more astonishing when you look at revenues. These three companies will bring in $1.4 trillion this year!

With numbers like that, they just have to be GameChangers, right? After all, no one company can come close to these massive dollar amounts. The Big 3 are ringing the ultimate cash register, and any other company in the world would salivate to be in their position.

But that does not make themGameChangers. They fall short of that standard, and let me explain why. (Get my list of true GameChangers here.)

The Ultimate Flaw

In my 30 years as a professional investor, I’ve seen time and time again how the best companies are those with what’s called "pricing power." True GameChangers have almost total control over pricing, from raw materials to the end product. In addition, that end product is so superior that they can charge almost whatever they want and people will pay it.

In other words, GameChangers, at minimum, control their own pricing. In some cases, they control it for an entire industry.

That’s not the case with the big oil companies. They have no more control over the price of oil than you or I do. Oil prices are driven by supply and demand, yes, but also by politics, the oil-producing nations that make up OPEC, currency fluctuations and more and more speculators trying to hit it big. Even terrorists impact oil prices.

Right now, oil is at $140 and the Big 3 are raking in the dough faster than they can count it. If oil goes to $200, they will earn even more profits. However, if oil falls back to $100 or even $75, the profits will be much smaller.

No one expects oil prices to drop that sharply next week, but...

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No one expects oil prices to drop that sharply next week, but whenever there is as much speculation involved in pricing as there is with oil, it’s almost inevitable that some air will be let out at some point. And that’s the problem. Oil companies are at the whim and mercy of the global price of oil, and that means unpredictable earnings. Wall Street absolutely hates that.

Here’s a second problem: mediocre profit margins of about 10%. (In contrast, the GameChangers stocks I recommend to my readers average profit margins of around 15%–20%!) Oil is very expensive to produce, so even though the big oil companies bring in a ton of money, they also spend a lot. Investors won’t pay a premium for those kinds of profit margins, so the P/E ratios of the Big 3 oil stocks are less than the S&P average of 15.3.

In fact, BP and ExxonMobil are down over the last six months. Yes, down. Hard to believe when you think about the prices you and I are paying for gas, isn’t it? Chevron is up, but only by about 10%. Those aren’t the GameChanging profits you and I want.

The GameChangers Way to Profit

At GameChangers, I’m currently recommending three great companies that are changing the energy game. These are the ones to own. All three offer real, practical solutions to our energy dilemma far more effective than any politician has devised and, frankly, better than anything being pursued in Big Oil’s board rooms. Here’s how these three companies are putting us on the right energy track:

Better Drilling: There are massive new supplies of oil and gas ready to be tapped by new methods. In particular, deep sea drilling is now feasible with never-before created alloys that can pierce the Earth’s mantle. Steel becomes tissue paper below 6,000 feet of sea water, but new carbon materials are 10 times stronger, yet much lighter.

The GameChanger here is new materials we can now build, atom by atom, to make uncrushable drill bits for deep-sea oil rigs. This equipment is already in use off the Indian coast, deep in the South China Seas and beneath the Arctic.

Oh, and these same carbon materials are being used more and more in the ever-expanding field of wind power. Like old-fashioned oil drills, traditional wind turbines (made of fiberglass) also crack over time. Lighter, stronger carbon materials made by our GameChanger solve that problem! Get all of the details here.

Better Efficiency: Our second GameChanger produces what is essentially detergent for coal power plants. An average coal-fired furnace is 50% efficient. (Your car engine is 25% efficient, so 50% is considered good.) Add detergent to the mix, and you get 60%–65% efficiency – and that is huge!

Add this detergent to coal power plants in China, where they are opening a new plant every 10 days, and you get to keep the lights turned on AND breathe the air. Want to learn more? Go here to get my specific buy instructions.

Better Alternatives: The Nuclear Age begins when it becomes possible to build walk-away safe reactors. That Age is here thanks to another entrepreneurial GameChanger. Now that reactors are indeed walk-away safe, the possibility of ending our dependence on traditional "fossil fuels" becomes a reality.

Our nuclear lynchpin is a small outfit in Texas that understands what it’s on to. China and South Korea are building nuclear plants as fast as the cement can be poured. Thirty plants are in the design stage, and now the U.S. is jumping on the bandwagon. In fact, our GameChanger won contracts on all three recently announced U.S. nuclear plants! This is huge because these nuclear plants will be the first built in the U.S. in 30 years.

I’m targeting a triple over the next several years, which is many times better than what you’ll get from traditional oil stocks! Get my insight on this GameChanger—and all of the others on my buy list—here.

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