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.

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

Energy Stocks

Debt reduction shores up these oil producers

ENCANA CORP. $9.15 (Toronto symbol ECA; Shares outstanding: 1.5 billion; Market cap: $14.3 billion; TSINetwork Rating: Average; Dividend yield: 1.1%; www.encana.com) operates four key properties: Montney (B.C.), Duvernay (Alberta), and Eagle Ford and Permian (both in Texas)....

2 min read

Pat McKeough

Energy Stocks

Imperial delays key project

IMPERIAL OIL LTD. $36 (Toronto symbol IMO; Cyclical-Growth Payer Portfolio, Resources sector; Shares outstanding: 792.7 million; Market cap: $28.5 billion; Dividend yield: 2.1%; Dividend Sustainability Rating: Above Average; www.imperialoil.ca) last raised its dividend by 18.8% with the July 2018 payment....

1 min read

Pat McKeough

Energy Stocks

Market still oversupplied

CAMECO CORP. $15.93 (Toronto symbol CCO; TSINetwork Rating: Extra Risk) (306-956-6200; www.cameco.com; Shares outstanding: 395.8 million; Market cap: $6.3 billion; Dividend yield 0.5%) is the world’s biggest uranium producer.

The company’s revenue in the quarter ended December 31, 2018, rose 2.7%, to $831 million from $809 million a year earlier....

1 min read

Pat McKeough

Energy Stocks

They aim to streamline their operations

DEVON ENERGY CORP. $29.33 (New York symbol DVN; TSINetwork Rating: Extra Risk) (405-235-3611; www.dvn.com; Shares outstanding: 436.3 million; Market cap: $12.6 billion; Dividend yield: 1.2%) is one of the largest explorers and producers of oil and natural gas in the U.S....

2 min read

Pat McKeough

Energy Stocks

High-quality reserves are key to their success

The best way to cut your risk when investing in oil and gas stocks is to focus on companies with long-lasting reserves. We also look for producers with low operating costs. That helps them stay profitable when oil prices decline.

We analyze three companies below: Encana and Cenovus offer strong long-term prospects; and while Pengrowth’s focus on its new oil sands project is a plus, its high debt load is a major risk factor.

ENCANA CORP....

6 min read

Pat McKeough

Energy Stocks

Imperial boosts its spending

IMPERIAL OIL LTD. $35.96 (Toronto symbol IMO; Shares outstanding: 792.7 million; Market cap: $27.9 billion; TSINetwork Rating: Average; Dividend yield: 2.1%; www.imperialoil.ca) produced an average 431,000 barrels a day in the fourth quarter of 2018....

1 min read

Pat McKeough

Energy Stocks

Its low debt is a big plus

ENERPLUS CORP. $11.89 (Toronto symbol ERF; Shares outstanding: 243.8 million; Market cap: $2.9 billion; TSINetwork Rating: Speculative; Dividend yield: 1.0%) produces oil and gas from properties in Western Canada—Alberta, Saskatchewan and B.C.—as well as North Dakota and Montana....

1 min read

Pat McKeough

Energy Stocks

Output to rise despite spending cut

APACHE CORP. $34 (New York symbol APA; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 379.5 million; Market cap: $12.9 billion; Price-to-sales ratio: 1.8; Dividend yield: 3.0%; 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 oil prices, the company plans to spend $2.4 billion on exploration and upgrades in 2019....

1 min read

Pat McKeough

Energy Stocks

Chevron’s refineries cut its risk

Oil prices have moved up 5% since the U.S. imposed new sanctions on Venezuela’s oil exports. OPEC’s recent production cuts have also contributed to the increase.

However, crude prices will likely remain volatile over the next few years. We feel the best way for conservative investors to cut their oil risk is with integrated producers like Chevron....

4 min read

Pat McKeough

Energy Stocks

Sasol expects a boost

SASOL LTD. (ADR) $29.16 (New York symbol SSL; Extra Risk) (082-883-9697; www.sasol.com; ADRs o/s: 653.0 million; Market cap: $19.0 billion; Dividend yield: 3.4%) is South Africa’s third-largest coal producer and is the world’s largest maker of fuel from coal....

1 min read

Pat McKeough

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Browse Premium Topics

Cannabis

Spinoffs

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a corporate subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors.

Dividend Stocks

Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes as closely as possible, since investors cannot actually buy an index outright.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Blue Chip Stocks

Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

Penny Stocks

A penny stock in general trades for under five dollars a share, and as the name implies, sometimes for pennies. Most of the time they’re young companies, or start-ups in speculative markets like mining or technology.

Growth Stocks

Growth stocks are companies that are likely to have sales and earnings growth well above market average. Frequently they pay few, if any, dividends. Instead they typically reinvest any extra cash flow to promote further growth. Chosen wisely—according to Pat McKeough’s advice—high-quality growth-oriented stocks can be worthwhile additions to most well-diversified portfolios.

Wealth Management

Wealth management is the practice of putting your savings to work so that it continues to grow over your lifetime and will also benefit your heirs. Wealth management encompasses many different areas of investing like long term investment planning and retirement planning.

Mining Stocks

Mining stocks are investments in companies that produce or explore for minerals. Some of these minerals include uranium, coal, molybdenum (which is used in steelmaking), copper, silver and gold. They are affected by fluctuating commodity prices in addition to their own business and operating risks.

How To Invest

Pat McKeough has been making investing for beginners simple—and profitable—by helping investors make big gains for more than 25 years. His advice to beginning investors is the same as it is for all investors: buy high-quality, mostly dividend paying stocks (or ETFs that hold these stocks) and evenly spread your investments over the five main economic sectors (Resources, Manufacturing, Finance, Utilities and Consumer). Pat also believes investors should avoid stocks in the broker/media limelight and focus on those with hidden or little-noticed assets.

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.