- 3 de Outubro, 2023
- Publicado por: Ana Sousa
- Categoria: Sem categoria
Its top holdings are “Big Oil” companies, with Exxon, Chevron, and ConocoPhillips making up 45% of the fund’s holdings. The improving backdrop for demand has helped the S&P 500’s energy sector close some of its performance gap with the broader market midway through the year, but it still has catching up to do. For the year to date through mid-July, the S&P 500 was up 17% on a price basis.
- Factors such as fluctuating oil prices, geopolitical tensions, regulatory changes, and the transition to renewable energy sources can impact the long-term viability of these investments.
- Investing in oil carries real risks, as illustrated by the near-total bankruptcy of the offshore drilling sector after persistent low oil prices for years in the mid-2010s.
- Halliburton’s expertise in these areas enables it to address the evolving challenges and requirements of the energy industry, from unconventional resource development to deepwater exploration.
Chevron Stock’s Momentum to Continue
This domestic oil producer’s stock has traded down to 70% of its 52-week high, leaving investors fearing a potential continuation of bearish price action. However, they can count on the backing of Warren Buffett, the market’s most renowned value investor. The first is that lower oil prices might negatively impact the energy sector; however, the risk-to-reward setup in the space seems more favorable than ever. After a couple of years of bearish price action, what may seem like a bearish development is actually a new bull market in disguise.
- Conversely, companies often scale back investment when prices plummet, reducing exploration efforts and project delays.
- Vertigo Studio SA is not responsible and cannot be held liable for any investment decision made by you.
- Riots storming several government buildings by his opponent’s supporters did not help either.
- Valero’s diverse product portfolio includes gasoline, diesel, jet, asphalt, petrochemicals and renewable diesel.
Best Gold Stocks & ETFs
Oil stocks, which also declined over the summer, are now trading sideways or trending lower along with oil prices. This presents a potential buying opportunity for investors who are looking to ride oil stocks higher as we head into the New Year. Identifying the best oil stocks is crucial, especially since oil prices and oil stocks tend to move cyclically. As a general rule, the best time to buy them is when oil prices fall and investors are dumping the sector, and the best time to sell is when prices cycle up, and conventional investors rush to buy. Overall, though, it’s important to remember that oil and natural gas stocks, like the companies they represent, will likely do better if energy prices are high. And their long-term outlook is deeply enmeshed with geopolitical, economic and regulatory factors beyond any one company’s control.
Despite those challenges, Wall Street is decidedly bullish on oil stocks in general, and really has the hots for a short list of names in particular. On top of that, the oil producer plans to ramp its annual share repurchase rate from $5 billion to $7 billion, with the aim of buying back over $20 billion in stock in the first three years following the deal. That has it on pace to retire all the equity issued to acquire Marathon ($17.5 billion) within two to three years of closing the deal.
PDC Energy
If you’re looking for more direct exposure to oil, you can consider looking to the commodities market, where there are products such as oil futures for sale. Jones, however, says such investments can be risky for retail investors. Integrated oil companies have some aspects of production, services and refining all in-house. This can mean that their risks are spread out more broadly than companies that specialize in one aspect of the oil industry. Andy Rosen is a former NerdWallet Best oil stock writer who covered taxes, cryptocurrency investing and alternative assets.
A potential massive catalyst ahead
For as cash-rich as Canadian Natural Resources is, it currently doesn’t have extensive plans to move into the renewable space. That shouldn’t necessarily detract investors — the company has 10+ billion barrels of crude oil in reserves — but it’s certainly something to keep note of. It’s the largest producer of natural gas and crude oil in Western Canada, and its ability to keep operating costs low while increasing production has helped it post strong revenues. The company’s growing scale and low-cost operations enable it to produce a lot of cash at $70 crude oil.
Best Natural Gas Stocks & ETFs to Watch
Indeed, S&P Global Market Intelligence tracks only eight analysts who cover the independent E&P company. Six of them call WLL stock a Strong Buy, one says Hold and one has no opinion. Goldman Sachs analyst Neil Mehta recommended that clients buy PDCE during the March pullback thanks to his expectation that the firm will produce $1.1 billion in free cash flow over the next two years. Note well that $1.1 billion in FCF would represent almost a third of PDCE’s entire market value. However, that’s not exactly a screaming buy in light of analysts’ 6% long-term EPS growth forecast.
By offering solutions that help reduce environmental impact and enhance operational efficiency, Halliburton is well-positioned to capitalize on the increasing demand for sustainable energy practices. Investing in oil carries real risks, as illustrated by the near-total bankruptcy of the offshore drilling sector after persistent low oil prices for years in the mid-2010s. So it is best to take a cautious approach and to keep diversification relatively high if . So producers that own large deposits or have a good track record of finding new resources are likely to keep making money. This is also an industry with a history of paying high dividends and other shareholder-friendly practices, especially for some sub-segments like midstream (pipelines). This ETF invests in all manner of fossil fuel companies, from oil & gas producers to drilling companies, storage, services, refineries, and transportation.
One way Devon Energy (DVN, $22.03) differentiates itself from other oil stocks in the exploration and production (E&P) sector is by way of management’s restraint and discipline. However, it’s essential to recognize that the oil and gas sector has challenges. Fluctuating commodity prices, geopolitical risks and regulatory changes are just a few factors you must navigate when considering investments in this space. Thorough research and carefully considering these factors are crucial for making informed investment decisions.
The views about companies, their securities and funds expressed in this article reflect the personal opinions of the individual writer. They do not represent the opinions of Vertigo Studio SA (publishers of FinMasters) on whether to buy, sell or hold shares of any particular stock. None of the writers or contributors of FinMasters are registered investment advisors, brokers/dealers, securities brokers, or financial planners. This article is being provided for informational and educational purposes only and on the condition that it will not form a primary basis for any investment decision.
Best Lithium Stocks & ETFs
A simple quantitative analysis assessed each company’s financial health, profitability and valuation metrics. This involved examining key financial indicators such as revenue growth, earnings stability, debt levels and cash flow generation to gauge overall financial strength and stability. The Q3 print was the latest in a string of record-breaking earnings for America’s largest oil company. If the company manages to keep its quarterly profits flowing, the upward momentum of its stock should continue as well. As of this writing, WTI crude oil is trading at $77 a barrel, down from more than $90 per barrel at the start of November.
Carefully considering your options and monitoring their performance is the best way to keep your portfolio in good condition. Global oil prices have retreated from their early-October highs, with market focus shifting from supply risks to concerns about global economic health, sluggish demand, and ample supply. After surpassing $80 per barrel in early October, Brent crude futures dropped to approximately $72 per barrel by mid-November as fears of an Israeli attack on Iran’s energy infrastructure subsided. Brazil, which faced operational challenges and outages this year, is projected to add 210,000 barrels per day (kb/d) by 2025, reaching 3.7 mb/d as new capacity exceeding 800 kb/d comes online. The company’s low-cost, high-return resource base enables it to produce strong free cash flow.
