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

Imperial is still our top oil pick

Imperial Oil has already seen the benefits of recent expansions at its Kearl oil sands property. The company is also doing a good job of controlling its operating costs.

Still, its focus on Canada adds risk. Specifically, a lack of new pipeline capacity continues to depress prices for Canadian producers compared to the crude prices for producers in the U.S....

4 min read

Pat McKeough

Energy Stocks

Cenovus is a top oil buy

CENOVUS ENERGY $11.83 (Toronto symbol CVE; Shares o/s: 1.2 billion; Market cap: $14.5 billion; TSINetwork Rating: Average; Dividend yield: 1.7%; www.cenovus.com) acquired 100% of its main oil sands properties in Alberta in May 2017. It did that through the purchase of the 50% stake held by its partner in the project, ConocoPhillips (New York symbol COP), for $17.7 billion in cash and stock.

In the quarter ended June 30, 2018, the company’s cash flow rose 3.9%, to $774 million from $745 million....

1 min read

Pat McKeough

Energy Stocks

Higher oil is a big plus for these producers

ENERPLUS CORP. $15.47 (Toronto symbol ERF; Shares outstanding: 244.8 million; Market cap: $3.7 billion; TSINetwork Rating: Speculative; Dividend yield: 0.8%) produces oil and gas from properties in Western Canada—Alberta, Saskatchewan and B.C.—as well as North Dakota and Montana....

2 min read

Pat McKeough

Energy Stocks

Drilling rebound brightens their outlook

ENERFLEX LTD. $16.30 (Toronto symbol EFX; TSINetwork Rating: Extra Risk) (403-387-6377; www.enerflex.com; Shares outstanding: 88.6 million; Market cap: $1.4 billion; Dividend yield: 2.3%) rents and sells equipment and services for natural gas production....

2 min read

Pat McKeough

Energy Stocks

We still prefer Cenovus over Encana

Both crude oil and natural gas prices have moved up since the start of 2018. Still, we feel U.S. sanctions on Iranian oil will further lift oil prices. At the same time, rising North American production of shale natural gas should hurt overall gas prices. Due to those factors, we prefer oil companies like Cenovus over gas producers like Encana.

ENCANA CORP....

2 min read

Pat McKeough

Energy Stocks

Higher oil buoys cash flow

CRESCENT POINT ENERGY $8.79 (Toronto symbol CPG; Shares outstanding: 549.0 million; Market cap: $4.9 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.1%; www.crescentpointenergy.com) is now focused on its Bakken light oil development in southeastern Saskatchewan.

In the quarter ended June 30, 2018, Crescent Point’s daily output rose 3.5%, to an average 181,818 barrels of oil equivalent from 175,615 a year earlier....

1 min read

Pat McKeough

Energy Stocks

Sasol connects with IoT

SASOL LTD. (ADR) $37.44 (New York symbol SSL; Extra Risk) (082-883-9697; www.sasol.com; ADRs o/s: 650.6 million; Market cap: $22.4 billion; Dividend yield: 2.2%) is South Africa’s third-largest coal producer and is the world’s largest maker of fuel from coal....

1 min read

Pat McKeough

Energy Stocks

Drilling focus should boost their output

DEVON ENERGY CORP. $43.75 (New York symbol DVN; TSINetwork Rating: Extra Risk) (405-235-3611; www.dvn.com; Shares outstanding: 523.4 million; Market cap: $22.9 billion; Dividend yield: 0.7%) is one of the largest explorers and producers of oil and natural gas in the U.S....

2 min read

Pat McKeough

Energy Stocks

Shutdown lifts oil prices

SUNCOR ENERGY INC. $54 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.6 billion; Market cap: $86.4 billion; Price-to-sales ratio: 2.7; Dividend yield: 2.7%; TSINetwork Rating: Average; www.suncor.com) is Canada’s largest integrated oil company, with its major projects in the Alberta oil sands....

1 min read

Pat McKeough

Energy Stocks

These energy juniors offer dividends

BONAVISTA ENERGY $1.46 (Toronto symbol BNP; Shares outstanding: 253.2 million; Market cap: $369.7 million; TSINetwork Rating: Speculative; Dividend yield: 2.7%; www.bonavistaenergy.com) explores for oil and gas across B.C., Alberta and Saskatchewan. Its output is 74% gas and 26% oil.

In the quarter ended March 31, 2018, the company’s cash flow fell 2.4%, to $69.1 million, or $0.27 a share, from $70.9 million, or $0.28, a year earlier....

2 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.