"Momentum stocks are breaking out again, and it's time to stock up," says Kevin Kennedy in his Coolcat Report. The advisor's latest recommendation is global blue chip energy firm, Sasol Ltd. (NYSE: SSL).

He explains, "When we select among blue chip stocks for our portfolio, we look for such factors as having set a 52-week high in the previous two weeks, as well as a ratio of at least 1.5-to-1 between the price and 52-week low.

"One such stock is Sasol, a global energy company with annual sales of more than $13 billion, headquartered in Johannesburg, South Africa. It is engaged in the commercial production and marketing of chemicals and liquid fuels with a growing interest in oil and gas exploration.

"The company has developed world-leading technology for the commercial production of synthetic fuels and chemicals from low-grade coal, as well as the conversion of natural gas to environment-friendly fuels and chemicals. The stock has advanced 22% in 2007 and is working on its seventh straight month of gains."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment commentary and favorite stocks of the nation's leading financial newsletter advisors.

What are the best energy investments for long-term investors? To answer this question, I surveyed 20 of the nation's leading financial newsletter advisors to find their current favorite ideas in the energy sector.

Interestingly, the advisors see the best opportunities in areas well beyond traditional oil firms; indeed, no one included in this report chose a major integrated oil company. Rather, the advisors have shown a preference for various oil services sectors, non-oil energy sources, and developing alternative technologies.

Some focus on areas such as deep-sea operations with Diamond Offshore Drilling Inc. (NYSE: DO), Transocean Inc. (NYSE: RIG) and Oceaneering International (NYSE: OII), while others look toward oil shippers such as Nordic American Tanker Shipping (NYSE: NAT) and refiners such as Valero Energy Corp. (NYSE: VLO).

Others chose companies that make specific products needed by the oil & gas industries such as NATCO Group Inc. (NYSE: NTG), which makes a wide range of oil & gas processing systems; Dresser-Rand Group Inc. (NYSE: DRC), a maker of control systems; Gardner Denver Inc. (NYSE: GDI), which makes compressor and fluid transfer systems; Tenaris (NYSE: TS), a maker of pipes and tublar products and Schlumberger Ltd. (NYSE: SLB), the largest and most diversified of the oil services companies.

In a world that's dependent on natural gas and eager for efficient ways to ship it, a company like South African-based Sasol Ltd (NYSE: SSL) will always be in demand. As a leader in the field of converting gas to diesel liquid (it also excels at converting coal to liquid), Sasol should always be a solid pick at the right price, especially since the company balances its risk in the cyclical energy markets with its chemical division, which produces a wide range of chemicals for industrial processes.

There are risks for a company like SSL beyond the cyclical nature of the energy markets. The company also faces competition from the growing popularity of liquefied natural gas. It can also suffer from unanticipated work stoppages, as happened for 40 days at one of its plants in the first half of 2007, forcing SSL to purchase synthetic fuels from third parties to fulfill its contracts, which cut into margins. If there are worldwide slowdowns in construction and other industries, there may be a slackening demand for both of SSL's divisions.

But I think SSL's integrated and diversified structure will protect it against any serious downside, and I'm impressed with a recent Bear Stearns report that predicted SSL will have a strong second half of 2007, driven mostly by improving sales in its chemical division, along with stronger margins created by recent technological developments that increase efficiency and should lower raw-material costs. The analyst predicted the fuels division would stay flat, but that this would be offset by the chemicals division. SSL will also benefit from a law passed in early August in South Africa that will protect SSL and other energy companies from any windfall taxes.

The Bear Stearns report predicted this stock to hit $50 in 2008; that's a gain of 25%, which may be ambitious, but I agree this company has room to grow, and the 2% dividend doesn't hurt either.

Type of Stock: A South African company specializing in fuel and chemical technologies.

Price Target: If the Bear Stearns report is correct, this stock is a solid buy at its current price near $40. But this stock can be volatile, and you might want to wait and see if you can grab it around $38 or even lower.

Hilary Kramer is a financial editor and money coach for AOL and an authority on investing. Visit her at www.hilarykramer.com.

MOST NOTEWORTHY: Take-Two Interactive Software Inc (TTWO), Circuit City Stores Inc (CC) and Exxon Mobil Corp (XOM) are today's more notable downgrades:

• Both Soleil and Citigroup downgraded Take-Two Interactive Software Inc (NASDAQ: TTWO) to Sell from Hold following the company's earnings shortfall and reduced guidance.

• Piper Jaffray downgraded Circuit City Stores Inc (NYSE: CC) to Market Perform from Outperform and a $20 target, based on checks that indicate weak sales trends following Christmas.

• AG Edwards removed Exxon Mobil Corp (NYSE: XOM) from its Focus Portfolio, believing the company offers less upside potential than other companies in the energy sector...

OTHER DOWNGRADES:

• Harrah's Entertainment Inc (NYSE: HET) was cut to Neutral from Buy at Buckingham Research.

• Sasol Limited ADR (NYSE: SSL) was downgraded to Hold from Buy at Citigroup based on the persistent regulator risk.

• ThinkEquity cut Syniverse Holdings Inc (NYSE: SVR) to Source of Funds from Accumulate citing expectations for increased competition and price pressures.

• Citigroup downgraded Barr Pharmaceuticals Inc (NYSE: BRL) to Hold from buy.

• First Albany cut Shuffle Master Inc (NASDAQ: SHFL) to Neutral from Buy.

• Jefferies downgraded Omnicare Inc (NYSE: OCR) to Hold from Buy with a $44 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).