Energy Stocks

What are energy stocks?

Businesses that work in the extraction, refining and delivery of energy sources such as natural gas, oil, uranium and coal, are considered energy stocks.

Resource and commodity stocks in general should make up only a limited portion of your portfolio—say less than 20% for a conservative investor or as much as 30% for an aggressive investor. And as part of that segment, energy stocks could make up, say half of that total. The rest could be fertilizer stocks, mining stocks and so on.

Oil and gas stocks have been below-average performers lately, and many investors are tempted to get out of the industry altogether. However, the energy sector can play a crucial role in your portfolio as a hedge against inflation. The low inflation rates of the past couple of decades deserve some of the blame for the poor performance of the sector. However, energy stocks will likely rebound in years to come as the global economy recovers.

  1. Invest mainly in well-established companies;
  2. Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);
  3. Downplay or avoid stocks in the broker/media limelight.

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Energy Stocks Library Archives

Profits rise on drilling rebound

ENERFLEX LTD. $13.06 (Toronto symbol EFX; TSINetwork Rating: Extra Risk) (403-387-6377; www.enerflex.com; Shares outstanding: 89.5 million; Market cap: $1.2 billion; Dividend yield: 3.2%) rents and sells equipment and services for natural gas production. That includes refrigeration gear and systems, power generators and processing plants.

The company’s… Read More

Paramount adds assets

PARAMOUNT RESOURCES $6.08 (Toronto symbol POU; TSINetwork Rating: Speculative) (403-290-3600; www.paramountres.com; Shares outstanding: 130.9 million; Market cap: $796.0 million; No dividends paid) owns oil and gas properties in Alberta and B.C.

Paramount has now reportedly bought the Alberta oil sands assets of Koch Industries. That company… Read More

High-quality operations make Imperial a buy

IMPERIAL OIL LTD. $33 (Toronto symbol IMO; Conservative Growth and Income Portfolios, Shares outstanding: 802.7 million; Market cap: $26.5 billion; Price-to-sales ratio: 0.8; Dividend yield: 2.7%; TSINetwork Rating: Average; www.imperialoil.ca) is a leading Canadian producer and refiner on crude oil. U.S.-based ExxonMobil (New York symbol… Read More

Encana rewards investors

ENCANA CORP. $6.03 (Toronto symbol ECA; Shares o/s: 1.4 billion; Market cap: $7.7 billion; TSINetwork Rating: Average; Divd. yield: 1.7%) plans to buy back up to $213 million U.S. of its common shares (about 3% of the total) through a Dutch auction process. Share repurchases raise earnings… Read More

Two beaten-down juniors: 1 buy, 1 hold

PEYTO EXPLORATION & DEVELOPMENT CORP. $4.00 (Toronto symbol PEY; Shares outstanding: 164.6 million; Market cap: $644.3 million; TSINetwork Rating: Extra Risk; Dividend yield: 6.0%; www.peyto.com) produces and explores for natural gas and oil in Alberta. Its production is 88% gas and 12% oil.
In the quarter ended March… Read More

Cost cuts are paying off

PARAMOUNT RESOURCES $6.87 (Toronto symbol POU; TSINetwork Rating: Speculative) (403-290-3600; www.paramountres.com; Shares outstanding: 130.9 million; Market cap: $943.2 million; No dividends paid) owns oil and gas properties in Alberta and B.C.
The company cut development spending to conserve cash due to low oil and gas prices. The move reduced… Read More

They’re setting themselves up for gains

CIMAREX ENERGY $49.76 (New York symbol XEC; TSINetwork Rating: Extra Risk) (303-295-3995; www.cimarex.com; Shares outstanding: 101.4 million; Market cap: $5.2 billion; Dividend yield: 1.6%) produces and explores for natural gas and oil. Gas makes up 41% of the company’s output; the remaining 59% is oil.
In the three months… Read More

Falling costs cut Suncor’s cyclical risk

SUNCOR ENERGY INC. $42 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.6 billion; Market cap: $67.2 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.0%; TSINetwork Rating: Average; www.suncor.com) is Canada’s largest integrated oil company, with major projects in the Alberta oil sands. It also owns… Read More

Aggressive stocks have a key role to play

Aggressive stocks, such as those featured in the portfolio on page 80, can lead to big returns. However, due to the risky or cyclical nature of their businesses, investment in higher-growth stocks can also produce big losses. That’s why you should limit your aggressive holdings… Read More

Buyback plan enhances value

ENCANA CORP. $6.54 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.4 billion; Market cap: $9.2 billion; P/S ratio: 1.6; Divd. yield: 1.5%; TSINetwork Rating: Average; www.encana.com) operates shale oil and natural gas wells in B.C., Alberta, Texas, Oklahoma, North Dakota and Utah.
The company plans… Read More

Updates on TC Energy Inc., IBM & Encana Corp.

TC ENERGY INC. $65.98 (Toronto symbol TRP; Shares outstanding: 927.0 million; Market cap: $59.9 billion; TSINetwork Rating: Above Average; Dividend yield: 4.6%; www.transcanada.com) (formerly TransCanada Corp.) recently agreed to sell 85% of its Northern Courier Pipeline to Alberta Investment Management Corporation (AIMCo). This 90-kolometre pipeline pumps bitumen… Read More

Pengrowth could be for sale

PENGROWTH ENERGY $0.50 (Toronto symbol PGF; Shares o/s: 547.4 million; Market cap: $280.0 million; TSINetwork Rating: Speculative; No dividends paid; www.pengrowth.com) has two main properties: its Lindbergh oil sands project in Alberta and its Groundbirch natural gas property in northeastern B.C.
Pengrowth’s average output in the three months… Read More

Junior oil and gas stocks set for a rebound

CRESCENT POINT ENERGY $4.04 (Toronto symbol CPG; Shares outstanding: 547.2 million; Market cap: $2.2 billion; TSINetwork Rating: Extra Risk; Dividend yield: 1.0%; www.crescentpointenergy.com) produces oil and gas in western Canada and Utah, with a focus on its Bakken light oil development in southeastern Saskatchewan.
In the quarter ended… Read More

Devon gains focus

DEVON ENERGY $26.91 (New York symbol DVN; TSINetwork Rating: Extra Risk) (405-235-3611; www.dvn.com; Shares o/s: 415.2 million; Market cap: $10.7 billion; Dividend yield: 1.3%) is a leading explorer and producer of oil and natural gas in the U.S.
The company now plans to focus on four core areas in… Read More

Here’s two Resource buys for an oil rebound

The recent drop in oil and gas prices has hurt the shares of both Encana and Finning. However, their recent acquisitions position them to profit when oil recovers.
ENCANA CORP. $6.37 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $9.6 billion;… Read More

Updates on CP Rail, Pengrowth Energy & BCE INC.

CANADIAN PACIFIC RAILWAY $306.96 (Toronto symbol CP; Shares o/s: 147.7 million; Market cap: $42.3 billion; TSINetwork Rating: Above Average; Dividend yield: 1.1%; www.cpr.ca) ships freight over its 22,000-kilometre rail network between Montreal and Vancouver, with links to hubs in the U.S. Midwest and Northeast.
The company continues to… Read More

IMO hikes its dividend

IMPERIAL OIL LTD. $36.20 (Toronto symbol IMO; Shares outstanding: 772.6 million; Market cap: $27.7 billion; TSINetwork Rating: Average; Dividend yield: 2.4%; www.imperialoil.ca) is Canada’s third-largest publicly traded oil company, after Suncor (No. 1) and Canadian Natural Resources. U.S.-based ExxonMobil (New York symbol XOM) owns 69.6% of Imperial.
Imperial’s… Read More

Apache ready to offset lower prices

APACHE CORP. $27 (New York symbol APA; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 375.9 million; Market cap: $10.1 billion; Price-to-sales ratio: 1.4; Dividend yield: 3.7%; TSINetwork Rating: Average; www.apachecorp.com) produces oil and natural gas from properties in the U.S., Egypt and the U.K.
Due to weaker crude… Read More

Sasol commits to Asia

SASOL LTD. (ADR) $25.64 (New York symbol SSL; Extra Risk) (082-883-9697; www.sasol.com; ADRs o/s: 624.7 million; Market cap: $16.0 billion; Dividend yield: 2.7%) has now completed its new alkoxylation plant in Nanjing, Jiangsu Province, China, on time and on budget.
Alkoxylation is a process that converts alcohols from oil… Read More