With crude oil prices creeping up again, to around $71 a barrel from $33 in February, some investors are recalibrating their exposure to oil stocks. Crude prices are still nowhere near their stratospheric high last year when they zoomed to more than $140. But oil stocks, although not yet entirely back in favor, have been catching fresh attention.

One of those attracting investor interest: Apache (APA), one of the largest U.S. independent oil-and-gas exploration and production companies, operating in North America, the North Sea, Egypt, Australia, offshore China, Argentina, and Poland. Apache has proved reserves of 2.4 billion barrels of oil equivalents.

"A big part of Apache's attraction is its large stake in the U.S. and its high success rate in oil drilling of about 93%," says Joseph Tatusko, chief investment officer at Westport Resources Management, which owns shares. About 61% of its proved reserves are in North America, he notes.

Apache is poised to be among the first out of the gate when the economic recovery gains traction, says Tatusko. As a group, oil stocks usually are among the first to rally, and "we expect Apache will be in that advancing first team," he adds.

The stock has already shot up from its 52-week low of 51.03 on Mar. 9 to 84.20 a share on June 12. True, it is still way below its 52-week high of 145 hit on July 2, 2008, but Tatusko sees it rising by at least another 20% from its current price this year. Part of the reason is some institutional investors are staying with the stock. Among them is JPMorgan Chase (JPM), which bought 2.2 million shares [as of Mar. 31, 2009], boosting its stake in Apache to 2.1%.

Financial Discipline Apache currently trades at a discount to its large-cap peers. However, "we expect Apache to catch up," says Fadel Gheit, senior oil analyst at Oppenheimer (OPY) [it seeks to do business with Apache], who rates the stock outperform. Apache's stock has advanced about 8% so far this year, while its peers on average have gained some 17%.

One reason why Gheit is confident Apache will be able to catch up is its "strong operating and financial disciplines, which are Apache's key competitive advantages, especially in industry downturns," he argues.

Gheit also expects the company to make more selective property acquisitions in negotiated transactions that create long-term value for its shareholders, as it has done over the years. It has a history of augmenting its production volume growth through acquisitions.