- (0:30) – Tips To Finding Value In Cyclical Industries
- (14:10) – Is Now A Good Time To Invest Into Energy?
- (25:30) – Episode Roundup: PXD, EOG, HES, SLB, BKR
- Podcast@Zacks.com
Welcome to Episode #339 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
With energy stocks rallying again, it’s time to take a look at commodities stocks. Tracey has been reading the book “The Joys of Compounding”, by Gautum Baid. It has a chapter that is very relevant to what is going on in commodities right now. That chapter is called “Investing in Commodity and Cyclical Stocks is all about the Capital Cycle.”
In the chapter, Baid gives tips on how to invest in commodities. Here’s a hint, they aren’t like other stocks. I cover what those tips are in the podcast. Tune in.
Are we in a new secular bull market in energy? If we are, there are going to be investing opportunities. What stocks should you be looking at?
5 Energy Stocks for Your Short List
1. Pioneer Natural Resources (PXD)
Pioneer Natural Resources is one of the largest exploration and production companies in the Permian Basin. In 2022, when crude prices were above $100, it paid out $6.27 billion to shareholders in dividends and other distributions.
Shares of Pioneer Natural Resources have jumped 14.3% in the last month but is up only 3% year-to-date. It has a debt-to-equity ratio of just 0.23.
Should Pioneer Natural Resources be on your short list?
2. EOG Resources, Inc. (EOG)
EOG Resources is a big cap exploration and production company with a market cap of $76.6 billion. It drills in the Permian, Williston, Anadarko, and Powder River basins, among others. In 2022, it paid out $5.1 billion in dividends and other distributions.
Shares of EOG Resources have popped 12.8% in the last month and are now up 1.2% year-to-date. It has a debt-to-equity ratio of 0.14.
Should investors have EOG Resources on their short list?
3. Hess Corp. (HES)
Hess is a global integrated energy company with exploration and midstream segments. It’s exploring in one of the key emerging oil markets: offshore Guyana. Hess also explores in the Bakken and offshore in the Gulf of Mexico. In 2022, it paid $975 million in dividends and other distributions.
Shares of Hess have rallied 16.5% in the last month and are up 10.4% year-to-date. It has a debt-to-equity ratio of 0.97.
Should investors look outside the United States with a company like Hess?
4. SLB (SLB)
SLB, formerly known as Schlumberger, is a global technology company focused on the energy industry. It operates in 100 countries. In 2022, SLB paid $848 million in dividends and other distributions.
Shares of SLB are up 10.4% in the last month and 10.2% year-to-date. It has a debt-to-equity ratio of 0.74.
Should a services company like SLB be on your short list?
5. Baker Hughes Co. (BKR)
Baker Hughes is an energy technology company with operations in 120 countries. In 2022, it paid $743 million in dividends and other distributions to shareholders.
Shares of Baker Hughes are up 6.7% in the last month but have been grinding higher all year. They’re up 19.6% year-to-date. Baker Hughes has a debt-to-equity ratio of 0.38.
Is Baker Hughes poised for further upside?
What Else Do You Need to Know About Investing in Commodities?
Tune into this week’s podcast to find out.
[In full disclosure, Tracey owns shares of PXD in her personal portfolio.]
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers “Most Likely for Early Price Pops.”
Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand-picked 7 your immediate attention.
Schlumberger Limited (SLB) : Free Stock Analysis Report
Hess Corporation (HES) : Free Stock Analysis Report
Pioneer Natural Resources Company (PXD) : Free Stock Analysis Report
EOG Resources, Inc. (EOG) : Free Stock Analysis Report
Baker Hughes Company (BKR) : Free Stock Analysis Report
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