Diversify with these two energy producers

Article Excerpt

The shares of oil and gas stocks remain high as energy demand stays strong. We continue to recommend that most investors maintain some exposure to the oil and gas industry as part of a balanced portfolio. But, to cut risk, you should stick with producers that have positive cash flow even in times of low energy prices. Here are two that should meet that requirement. Moreover, they pay solid dividends: ARC RESOURCES, $29.16, is a buy. The company (Toronto symbol ARX; Shares o/s: 585.0 million; Market cap: $17.1 billion; TSINetwork Rating: Extra Risk; Dividend yield: 2.6%; www.arcresources.com) produces natural gas as well as oil. Its average output of 372,265 barrels of oil equivalent per day is 63% natural gas and 37% oil. Cash flow per share in the quarter ended March 31, 2025, rose 43.6%, to $1.45 from $1.01 a year earlier. Higher realized oil and gas prices and 5.7% higher output led to the gain. Long-term debt stands at $1.1 billion, or a low 6.4% of ARC’s…