OPEC’s November 30th agreement with non-OPEC countries to limit oil production sent energy companies up in price, but the breakout of EOG Resources (EOG) stock may be the best one to buy into. (See also: OPEC Reaches Deal on Oil, Futures Soar.)

The company was already profitable with oil in the $40 price range, and at $50 per barrel, EOG can afford to expand. (See also: EOG Sees Profit Even If Oil Prices Fluctuate.)

EOG management has positioned the company as a unique player among drillers by focusing on premium sites. These are locations that have high productivity and low costs. The company has systematically moved away from its least productive sites, and set a goal of having 98% of its rigs on premium sites by 2008.

This focus has resulted in a projected cash flow of $3 billion for 2016. The company raised another $200 million by selling its non-premium sites. This cash will enable EOG to reach $2.7 billion for capital expenditures (CAPEX) this year. The result, according to management, is a projected compound annual growth rate (CAGR) of 15% to 25% if oil remains in the $50 to $60 price range.

Many energy companies have been hanging on by a thread, hoping OPEC would reach an agreement that would bail them out of trouble. Because EOG was already profitable, it is positioned to outperform going forward. It recently purchased acreage by acquiring Yates Petroleum, and that will add additional capacity. (See also: The Secret of EOG’s Yates Deal.)

If the November 30th breakout is followed by another day or two of significant increases on heavy volume, EOG could be off and running. Pessimists may step in and start selling, based on suspicion that the OPEC agreement will not be enough to word down excess oil inventories worldwide. This could create an opportunity for investors to buy EOG on a down day.

Just to be cautious, investors would need to place a stop-loss order or even a trailing stop-loss order. These types of orders would trigger an automatic sale of the stock if the breakout should fail, and investors could either prevent losses or lock in profits. (See also: Trailing-Stop/Stop-Loss Combo Leads To Winning Trades.)

EOG Resources closed December 1 at $104.76 per share, up $2.24 or 2.18%, on volume of 6.17 million shares. Average daily trading volume is 3.39 million shares.