Here's a quick update to the piece I wrote on April 1st regarding one of my favorite energy stocks, Plains Exploration (PXP). If you missed it a few weeks back, you should take a look, but the jist of it was that Plains sold some oil wells to XTO Energy (XTO) and used the proceeds to get rid of some old oil price hedges it had in place (that were preventing it from reaping the full benefits of $50+ oil).

As I pointed out, the stock was up 3% that day, to $36 a share. Since then, oil has fallen from a high of $57 to the current $50, and Plains stock has dropped from 36 to 31. It was obvious that earnings estimates were going to rise with the new strategy, but how much exactly was unclear on the day of the announcement.

Well, a quick look at Wall Street's updated profit numbers for PXP shows even more of a positive impact than I had anticipated. EPS estimates for 2006 have gone from $3 to $4 per share. The stock, meanwhile, has dropped 15 percent. The current P/E on '06 is less than 8 times.

On days when oil prices are weak and the stocks are suffering, Plains is one stock that should be accumulated, in my opinion.