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.
- Invest mainly in well-established companies;
- Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);
- Downplay or avoid stocks in the broker/media limelight.
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Energy Stocks Library Archives
TORSTAR CORP. $0.38 (www.torstar.com) remains a hold, but only for highly aggressive investors. The COVID-19 outbreak has forced many businesses to temporarily shut down. As a result, they are cutting spending on advertising....
IMPERIAL OIL LTD. $18 is still a buy for the Resources sector of your portfolio. The integrated oil producer (Toronto symbol IMO; Conservative Growth and Income Portfolios; Shares outstanding: 743.9 million; Market cap: $13.4 billion; Price-to-sales ratio: 0.4; Dividend yield: 4.9%; TSINetwork Rating: Average; www.imperialoil.ca) is cutting its 2020 capital spending plans by about 30% due to sharply lower crude oil prices....
BCE INC. $55.33, is a buy. The telecom (Toronto symbol BCE; Shares o/s: 904.3 million; Market cap: $50.0 billion; TSINetwork Rating: Above Average; Divd. yield: 6.0%; www.bce.ca) is Canada’s largest traditional telephone service provider: it has 2.7 million residential customers in Ontario, Quebec, Manitoba and the Atlantic provinces....
Long-time readers know that we are constantly evaluating the stocks we recommend to see if they should remain in the Power Growth Investor newsletter.
Although most stocks have dropped in the current market downturn, we feel top-quality shares will be among the first to rebound....
Although most stocks have dropped in the current market downturn, we feel top-quality shares will be among the first to rebound....
NUTRIEN LTD. $44 is a buy. The company (Toronto symbol NTR; Aggressive Growth Portfolio, Resources sector; Shares o/s: 572.9 million; Market cap: $25.2 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.9%; TSINetwork Rating: Average; www.nutrien.com) is world’s largest producer of agricultural fertilizers, shipping about 27 million tonnes annually....
CENOVUS ENERGY, $9.32, is a buy for the Resources segment of your portfolio. The company (Toronto symbol CVE; Shares o/s: 1.2 billion; Market cap: $11.5 billion; TSINetwork Rating: Average; Dividend yield: 2.7%; www.cenovus.com) owns 100% of the Christina Lake and Foster Creek oil sands properties in Alberta....
Oil and gas prices remain under pressure, but we still believe most investors benefit from maintaining some exposure to the industry as part of a balanced portfolio. Now more than ever, however, you should stick to producers with positive cash flow—despite low energy prices....
The coronavirus outbreak in China will undoubtedly slow global economic growth in 2020 and put more pressure on oil prices. As well, demands that countries cut their carbon emissions could put more pressure on oil prices.
However, the world will still need oil for many decades to come which is why investors should maintain some exposure to this industry....
However, the world will still need oil for many decades to come which is why investors should maintain some exposure to this industry....
OVINTIV INC. $22.39, is a buy for the Resources sector of your portfolio. The energy producer (Toronto symbol OVV; Shares outstanding: 259.8 million; Market cap: $27.5 billion; TSINetwork Rating: Average; Dividend yield: 2.2%) is the former Encana Corp.
Shareholders and regulators recently approved Encana’s plan to become a U.S.-based firm and change its name to Ovintiv Inc.
Effective January 27, 2020, the company consolidated its shares: investors received one share of Ovintiv for every five Encana shares they held.
The new shares now trade on both the Toronto and New York exchanges under the “OVV” symbol.
The move to the U.S....
IMPERIAL OIL LTD. $31.75, is a buy for safety-conscious investors. The stock (Toronto symbol IMO; Shares outstanding: 764.2 million; Market cap: $23.6 billion; TSINetwork Rating: Average; Dividend yield: 2.8%; www.imperialoil.ca) lets you tap Canada’s third-largest publicly traded oil producer, after Suncor (No....