What happened

Shares of EOG Resources (NYSE:EOG) jumped in September, gaining nearly 13% for the month. While the shale driller didn't report any needle-moving news last month, it didn't need any, since analysts and oil provided all the fuel required to drive the stock higher.

So what

Oil rebounded sharply last month, with the U.S. oil benchmark WTI gaining 7.7% to end September at $51.67 per barrel, pushing crude up more than 20% from its bottom in June. Powering that rally was a significant improvement in oil market fundamentals as robust demand and slowing U.S. supply growth helped drain some of the glut of oil that had been sitting in storage. The return of $50 oil was great news for EOG resources, as it's poised to thrive at that level, which is high enough to supply the company with the cash flow to deliver 15% compound annual oil production growth through 2020. For comparison's sake, rivals Pioneer Natural Resources and Devon Energy need crude at $55 a barrel and above to drive their long-term growth plans.

An oil pump with a majestic sky in the background.

Image source: Getty Images.

With oil rising, analysts started turning bullish on EOG Resources' stock last month. Morgan Stanley, for example, upgraded it from equal weight to overweight and raised its price target from $97 to $106 per share citing its attractive risk/reward profile relative to its peers. The bank said that EOG has climbed to the top of the heap, putting it above Devon, Pioneer, and other U.S.-focused drillers. Imperial Capital, meanwhile, initiated coverage on EOG last month with an outperform rating and a $115 price target.

Now what

While the combination of rising oil prices and bullish analysts pushed EOG Resources' stock up double digits last month, it's still down 5% this year and trades in the mid-$90s, which is well below what many analysts think it's worth. Investors who are bullish on crude should consider adding this top-tier oil stock to their portfolios, since it appears to have plenty of upside left in the tank.