Halfway through 2014, we believe much of what we argued at the outset of the year:

• That natural gas prices are too low to rebuild depleted US storage, feed the coming wave of  LNG exports, and supply US and Mexican power plants switching from coal and crude respectively; and that the only way to alleviate this imbalance is via higher prices

• That growth in the global demand for crude continues to outpace the production gains delivered largely by the US shale basins, to the benefit of low-cost domestic drillers for whom relatively modest increases in the share of their sales from crude can mean big increases in cash flow

• That US refiners will continue to benefit from abundant domestic crude supply notwithstanding Wednesday’s scare over government approval of crude condensate exports, and will continue to export a growing share of their output as the world’s most efficient, lowest-cost fuel producers

• That the transformation of the domestic energy grid from an import-focused one to one increasingly geared for exports will continue to create lucrative midstream opportunities for companies with sufficient scale and geographic reach

• That sponsors of low-yielding income securities in the energy arena will continue to profit from access to this low-cost source of equity capital

• What we couldn’t have known at the beginning of the year is how quickly the long-suffering drilling stocks would transform into the market’s leading sector. We’re optimistic that this trend still has legs, but also worry that the energy equity patch could be due for a near-term correction

• We see downside price risk in crude should Mideast supply disruptions ease, but believe there is plenty of upside to the price of natural gas and nuclear fuel as Asian petrochemical producers and utilities increasingly seek out these lower-cost feedstocks

• Large-scale solar projects should continue to gain ground on hydrocarbon fuels as technological advances make solar the one energy sector in which costs are still declining dramatically

How does all of this factor into our new ranking of Best Buys? For one, it makes us want to stick with the long-term winners that have powered the portfolios’ recent outperformance.

Especially attractive at this point are industry leaders with proven management and both the scale and the financial wherewithal to exploit energy’s bullish fundamentals. That’s why 11 of the 15 names below were already designated a Best Buy at some point this year, and why the top eight is made up entirely of cash-rich large caps, the sort of stock that lets you sleep at night even if the market is stumbling.

At this point in the five-year-old bull market, we’re not likely to come up with as many home runs as we cranked out even last year. Most of the really fat pitches have already been blasted out of the park. The key now is to keep hitting singles and doubles while avoiding costly errors. The first eight Best Buys were selected with this defensive strategy in mind, though they also retain the potential for significant appreciation.

The bottom half of the list offers perhaps even greater upside but also significantly more downside and volatility. These names are on this list because we believe the upside is more probable and large enough to justify the risks. But they’re hardly layups.

1. National Oilwell Varco (NYSE: NOV)

The recent Conservative Portfolio addition is a free cash flow machine with a leading franchise in equipping drilling rigs on land and offshore, with an underappreciated servicing revenue stream, more cash than debt and a valuation that looks much too low. Shares have returned 35 percent over the last 12 months and 10 percent since we recommended them on May 30. Buy NOV below $88. (The price target has been adjusted from the prior $96 to account for the recent spinoff of the procurement logistics business.)

2. Schlumberger (NYSE: SLB)

The leading oil field services supplier has margins and free cash flow that are the envy of the industry and is ideally placed to profit from the global adoption of the shale drilling techniques pioneered in the US. Management is now projecting accelerated earnings growth of 17 to 20 percent annually through 2017, with free cash flow equal to at least 75 percent of net earnings of $9-10 per share in three years. And this company almost always delivers on its promises. The stock has returned 60 percent over the last 12 months. Buy SLB below the increased price target of $130.

3. EOG Resources (NYSE: EOG)

The biggest and the best US shale driller is the leading crude producer in the Eagle Ford and also a fast-growing one in the Bakken, two key basins where EOG’s wells pay for themselves on an after-tax basis in less than a year. The high returns are driving cash flow sufficient to cover the company’s rising capital spending and generating a surplus that EOG plans to use to reduce its debt and further increase its modest dividend. Crude production is forecast to increase 29 percent this year, accounting for the bulk of the company’s revenue. EOG’s valuation, scale and opportunities should make it the target of choice for any oil major seeking a one-stop growth boost. The investment has returned 69 percent over the last 12 months and 243 percent over its five years in the Growth Portfolio. Buy EOG below the increased target of $135.

4. ConocoPhillips (NYSE: COP)

ConocoPhillips is the tortoise to EOG’s hare, aiming to increase broadly diversified production by 3 to 5 percent a year, with similar margin growth. But the stock has not been slow off the mark since we added it to the Conservative Portfolio, returning 32 percent in less than five months. Conoco’s devotion to its dividend, currently yielding 3.2 percent, is part of the appeal. But so are its excellent growth prospects in US shale basins, notably the Eagle Ford and the Bakken. Shale development, along with LNG export projects and growing production from Canadian oil sands, is being financed with the money earned from aging but still prolific conventional wells in Alaska, the North Sea and Asia. This is one to own for its financial discipline and low lifting costs, as well as underappreciated growth prospects. Buy COP below the increased target of $100.      

5. Energy Transfer Equity (NYSE: ETE)

A master limited partnership at the head of one of the largest MLP “families,” ETE is a growth play on the hectic development of midstream infrastructure sparked by the domestic shale boom, notably as the sponsor of one of the largest LNG export projects in which most of the risks have been laid off on an eager and deep-pocketed foreign partner. Its large MLP affiliates are all pursuing acquisitions that will make them even larger, enriching ETE via fast-growing incentive distribution rights. The 2.5 percent yield is a bonus. Energy Transfer Equity has returned 29 percent since its March 13 addition to the Growth Portfolio. Buy ETE below the increased target of $66.  

6. Enterprise Products Partners (NYSE: EPD)

One of the largest MLPs and almost surely the most financially conservative of the lot, Enterprise is financing its increasingly lucrative processing of natural gas liquids for export as liquefied petroleum gas partly out of retained cash flow. The 3.7 percent yield is as secure as they get, and middling distribution growth should pick up as Enterprise’s recent investments come to fruition. LPG derived from cheap natural gas should become more valuable over time as an alternative to expensive oil, and EPD has the best position in this business. While EPD does not collect incentive distribution right, neither does it pay them after buying out its general partner. Units boast a 12-month return of 37 percent. Buy EPD below the increased target of $85.

7. Devon Energy (NYSE: DVN)

Like ConocoPhillips, Devon has shown strong financial discipline, carries a modest valuation, has acquired a promising crude position in the Eagle Ford and retains significant upside potential from ample natural gas reserves should prices lift down the road. But it’s on pace to deliver faster cash flow growth as a result of its transformation from a leading gas driller into one of the leading domestic onshore producers of crude. Thanks to heavy but self-financed investment in the Eagle Ford and the Permian, oil production is expected to increase 30 percent this year and another 20 percent in 2015, at which point it would account for most of the company’s revenue at current prices. Devon’s merger of its midstream assets with an independent MLP last year has proven to be another savvy move, already adding billions of dollars of book value. The stock has returned 35 percent in the nine months since we recommended it. Buy DVN below the increased target of $90.

8. EQT (NYSE: EQT)

EQT remains one of the most efficient and fastest growing Marcellus gas producers, capitalizing on its position in the play’s liquids-rich southwestern core to drive big gains in the production of lucrative natural gas liquids. At current prices EQT’s Marcellus wells offer a 70 percent annual rate of after-tax return. Its thriving midstream business, monetized via an affiliated MLP, has created much additional value and will continue to be a source of cheap capital thanks to asset  dropdowns. The stock has returned 53 percent over the last 12 months. Buy EQT below the increased target of $120.

9. Jones Energy (NYSE: JONE)

Our involvement with this small-cap Mid-Continent driller didn’t start out well, as the share price promptly plunged more than 20 percent in the five weeks following the Feb. 13 recommendation, continuing an erratic trading pattern in the wake of its lackluster 2013 IPO. But the attractions of 30- percent-plus production growth delivered from cash flow, under experienced, heavily invested management and from a dominant position in a niche play known for low production costs soon won out. Shares have rallied 42 percent since we designated Jones a Best Buy on March 27, near the lows, for a net current return of 18 percent. But there should be much more to go. Jones is leading off the second, more speculative half of this list for a reason. Buy JONE below the increased target of $23.

10. Carrizo Oil & Gas (NASDAQ: CRZO)

The Eagle Ford driller has quickly and expertly transformed itself from mainly a gas producer into a rapidly growing crude play. Crude now accounts for 60 percent of production and the bulk of the cash flow, and oil production is expected to grow 54 percent this year. Carrizo is still spending well above cash flow to drill prolific Eagle Ford wells that at current prices pay for themselves in less than 10 month. But its debt leverage is relatively modest, and liquidity ample to continue to add bolt on acreage and operate three rigs in the Eagle Ford while also developing promising positions in the Utica and Niobrara shales. Upcoming downspacing test results could validate the company’s contention that its nearly 68,000 net acres in the Eagle Ford remain undervalued by the market. A top three Best Buy throughout the first half of the year, Carrizo has returned 68 percent since joining the Aggressive Portfolio on Dec. 11. Buy CRZO below the increased target of $80.

11. Ensco (NYSE: ESV)

Ensco has the offshore drilling industry’s second-newest fleet after longtime Aggressive Portfolio holding Seadrill (NYSE: SDRL), and like Seadrill it spent much of the first half of the year in investors’ doghouse amid a slowdown in rig contracting and the resulting weakening of day rates. But the trading action has improved for both names of late, and while Ensco can’t match Seadrill’s revenue growth rate or dividend yield what it does offer is a much less leveraged balance sheet and more conservative management, while still delivering a current yield of 5.4 percent. Adjusting for Seadrill’s much higher debt and greater enterprise value, Ensco’s ample cash flow also comes considerably cheaper. The hiring of a 45-year-old CEO who was a rising star at Schlumberger could further boost returns and valuations. And given the high crude prices and the inevitable slowdown in deliveries of new rigs day rates won’t keep slumping much longer. The stock is up 5 percent since joining the Conservative Portfolio on May 30. Buy ESV below $65.   

12. Oasis Petroleum (NYSE: OAS)

The leading pure play in the Williston Basin that includes the Bakken, Oasis was one of the portfolio’s star performers for much of last year, until a series of acquisitions that expanded the company’s Williston position by nearly 50 percent to some 500,000 acres spooked investors with its cost in excess of $1.5 billion. Management’s conservative guidance didn’t help, and as a result it wasn’t until late March that the stock embarked on its powerful recent rally. The added turf and aggressive factory-style development of previously held acreage are expected to boost oil production by some 42 percent this year, with cash flow likely covering more than two thirds of this year’s $1.4 billion capital spending budget. At internal return rates approaching 75 percent, it makes good sense for Oasis to borrow the rest while optimizing well spacing and frack designs while preparing to bring full development drilling to its acquired acreage late next year. Good test results from wells probing the Three Forks benches beneath the Bakken could serve as an additional catalyst. Despite the protracted pullback, Oasis has returned 38 percent over the last 12 months. Buy OAS below the increased target of $62.

13. Cabot Oil & Gas (NYSE: COG)

The leading driller in the northeast, dry-gas sweet spot of the Marcellus has been held back by worries over regional discounts on Marcellus gas dictated by a shortage of takeaway capacity from the basin. But Cabot has invested heavily in infrastructure that will soon relieve this bottleneck and give the company increased access to the premium wholesale hubs in the Northeast. In the meantime, near-term gas production is well hedged and the rapid, low-cost growth Cabot* is delivering keeps building value not yet reflected in the share price. Although Cabot also has a promising crude drilling program in the Eagle Ford, it’s one of the purest plays on the eventual increase in natural gas prices. Despite a loss of 3 percent over the last 12 months, buy COG below $42.50.    

14. SunEdison (NASDAQ: SUNE)