Despite concerns surrounding high inflation and slowing growth, this year has been a stellar one for Oil/Energy bulls. The space has easily emerged as the best performing of all 11 U.S. market sectors, gaining nearly 57% so far in 2022. In contrast, the other 10 indexes have all suffered losses year to date. Meanwhile, the broader S&P 500 benchmark is down more than 19% during this period. While Wall Street continues to be largely bullish on energy, the sector is notoriously volatile, with sudden positive surprises and crashes. Against this backdrop, it will be fruitful to invest in top-ranked companies that are trading below their true value before the broader market catches on. Taking this into account, Murphy USA MUSA, NexTier Oilfield Solutions NEX, Phillips 66 PSX, ProPetro Holding PUMP and Liberty Energy LBRT make the cut.
Apart from a positive fundamental picture, the catalyst behind the energy markets’ strength could be attributed to geopolitical uncertainty amid Russia’s military operations in Ukraine. In March, crude prices surged to multi-year highs of $130 on concerns about supplies from Russia, which is one of the world's largest producers of the commodity. Agreed, oil has pulled back from those lofty levels. However, the commodity still has enough reasons to stay elevated in the near-to-medium term, with the conflict showing no sign of a quick resolution, the risk of dwindling inventory and the influential oil exporters’ group OPEC sticking to a conservative production profile. Meanwhile, natural gas hit $10 per MMBtu for the first time since 2008 earlier this year and is still trading some 75% higher year to date on the back of favorable weather and strong LNG shipments.
While the Energy sector can generate great returns when commodity prices go up and profits skyrocket, it is also exposed to heavy selling pressure when realizations crater. In other words, the oil and gas business is inherently cyclical, with delicate supply/demand balances, among others, determining their fortunes. Given this uncertainty, it will be wise for investors to apportion their funds in value stocks. Value investing has always been a popular strategy, and with a good reason too. Historical data suggests that value stocks not only tend to outperform growth stocks but are relatively less volatile. Specifically, for investors who are risk-averse, value investing offers an opportunity to enter the market and grab stocks that have otherwise been overlooked by most, and are thus trading at cheap multiples.
To go with a Value Score of A, we have shortlisted companies with strong fundamentals. This is where the Zacks Rank can come in really handy. We have picked five energy stocks with a Zacks Rank of #2 (Buy) as our research shows such stocks offer good investment opportunities. The Zacks Rank is a reliable tool that helps you to trade with confidence regardless of your trading style and risk tolerance. To learn more about how you can use this proven system for market-beating gains, visit Zacks Rank Education. You can see the complete list of today’s Zacks #1 Rank stocks here. Our chosen stocks also have a market capitalization of more than $1 billion. Murphy USA: It is a leading independent retailer of motor fuel and convenience merchandise in the United States. The proximity of Murphy USA’s fuel stations to Walmart supercenters helps the company to leverage the strong and consistent traffic that these stores attract. MUSA’s acquisition of QuickChek Corporation — a family-owned food and beverage chain located — is expected to help improve its offerings. Over the past 90 days, this El Dorado, AR-based Murphy USA has seen the Zacks Consensus Estimate for 2022 improve 11.2%. MUSA, which surpassed third-quarter bottom-line estimates on higher retail gasoline price and margin, is valued at around $6.6 billion. Shares of MUSA are up 47.3% year to date. NexTier Oilfield Solutions: NexTier Oilfield Solutions is a provider of technical products and services to drillers of oil and gas wells. The company continues to strengthen the customer base for its high-return projects, well-site offerings and digital tools (like NexHub). NEX’s integrated frac fleet services command premium pricing, while its conservative balance sheet and nimble cost structure allow for returning a sizeable portion of free cash to shareholders. The 2022 Zacks Consensus Estimate for this Houston, TX-based firm indicates 427.9% year-over-year earnings per share growth. NexTier Oilfield Solutions beat the Zacks Consensus Estimate for earnings in three of the last four quarters. Valued at around $2.4 billion, the company has gained 169.3% so far this year. Phillips 66: Phillips 66 is one of the leading refining players in terms of size, efficiency and strength. The company buys, sells and refines crude oil and other feedstocks at its refineries. PSX, with a throughput capacity of 2 million barrels per day, owns an interest in 12 refineries in the United States and Europe. Moreover, it owns 7,110 branded U.S. outlets and 1,700 international ones. Phillips 66 has an expected earnings growth rate of 242.6% for the current year. PSX beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 28.1%. Valued at around $49.1 billion, Phillips 66 has gained 43.4% in 2022. ProPetro Holding: Founded in 2005, ProPetro Holding is an oilfield services provider operating primarily in the Permian Basin spread over west Texas and New Mexico. The company offers a wide spectrum of specialized, complementary services and equipment for the exploration and production of oil and natural gas. Approximately 99% of ProPetro's total revenues come from the Permian Basin. The 2022 Zacks Consensus Estimate for this Midland, TX-based firm indicates 145.3% year-over-year earnings per share growth. ProPetro holding beat the Zacks Consensus Estimate for earnings in three of the last four quarters. PUMP — valued at around $1.2 billion — has seen its shares go up 26.9% year to date. Liberty Energy: Previously known as Liberty Oilfield Services, it is a premier provider of hydraulic fracturing and other auxiliary services to onshore exploration and production companies in North America. The Denver, CO-based independent, pure play operates in the Permian Basin, the Eagle Ford Shale, the Denver-Julesburg Basin, the Williston Basin, the San Juan Basin, the Powder River Basin, the Haynesville Shale, the Oklahoma Scoop and Stack areas, the Marcellus Shale, Utica Shale, and the Western Canadian Sedimentary Basins. The 2022 Zacks Consensus Estimate for the firm indicates 298% year-over-year earnings per share growth. Liberty Energy, with a market capitalization of some $3 billion, beat the Zacks Consensus Estimate for earnings in three of the last four quarters. LBRT has a trailing four-quarter earnings surprise of roughly 58.5%, on average. The company has gained 67% so far this year.
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NEW YORK/WASHINGTON (Reuters) -Investment bankers and deal lawyers accustomed to regulatory hurdles to their mergers face an unprecedented challenge under U.S. President Joe Biden - antitrust watchdogs who are undaunted when they lose such battles in court. The U.S. Justice Department and Federal Trade Commission (FTC) have attempted to thwart 22 mergers since Biden came into office in January 2021, according to a Reuters review of announcements from the agencies. That outnumbers the antitrust challenges during the first two years of former President Barack Obama's first term in office and is twice as many as in Donald Trump's first two years, the Reuters analysis shows.
In a statement agreed by consensus, the 15-member council said the ban on women and girls attending high school and universities in Afghanistan "represents an increasing erosion for the respect of human rights and fundamental freedoms." U.N. Secretary-General Antonio Guterres said on Twitter on Tuesday that the restrictions were "unjustifiable human rights violations and must be revoked."
Similarweb Senior Insights Manager and Travel Expert Jim Corridore joins Yahoo Finance Live to discuss the ongoing controversy surrounding Southwest Airlines and its number of cancellations over the holidays.
BRASILIA (Reuters) -Brazilian President-elect Luiz Inacio Lula da Silva has invited centrist Senator Simone Tebet to be his planning minister, a close Lula aide said on Tuesday. Future Institutional Affairs Minister Alexandre Padilha said in a press conference Tebet had not yet formally accepted, but noted that her party, the Brazilian Democratic Movement, had given a "positive signal." Finding a place for Tebet in his cabinet has been one of the key challenges facing Lula in recent weeks as he builds his team ahead of a Jan. 1 inauguration, with nearly half of the incoming ministers yet to be announced.
STORY: From a large, red plastic bag is where Ragab handed out the gifts he wrapped to the children, who were gathered around him at a square in the old city of Mosul. Most of Mosul's old town remains in ruins from the battle against Islamic State where it was once their stronghold. Ragab’s friend helped push his wheelchair over the debris-littered streets and children walked in unison next to them through the town while listening to festive music and playing games.Islamic State had brutalised minorities and Muslims alike, and celebrations such as Christmas and New Year were prohibited.Some of the city’s Christian community who had fled Iraq during IS reign are slowly trickling back, attending church service and mass this holiday season.
Shares of the United States Oil Fund surged last week, capping a phenomenal run in recent weeks that far outpaced meager gains in the price of oil. The fund has made major moves to protect itself against swings in the near-term price of oil. When oil slumped in 2020, USO began investing in multiple long-dated futures contracts for oil rather than relying on the next month’s price.
The popular Chinese video app TikTok has been banned from all U.S. House of Representatives-managed devices, according to the House's administration arm, mimicking a law soon to go into effect banning the app from U.S. government devices. The app is considered "high risk due to a number of security issues," the House's Chief Administrative Officer (CAO) said in a message sent to all lawmakers and staff on Tuesday, and must be deleted from all devices managed by the House. The new rule follows a series of moves by U.S. state governments to ban TikTok, owned by Beijing-based ByteDance Ltd, from government devices.
Russia has rejected Kyiv's calls for a 'peace summit' mediated by the UN to end the war and called it 'diplomacy 404.'
(Bloomberg) -- Climate labels on fast-food menus can help steer people in the US away from ordering beef — the food with the worst impact on the climate — and towards meals that are better for the planet, according to new research.Most Read from BloombergSouthwest Air Memos Showed Growing Alarm on Eve of Epic Winter StormSouth Korea Sends Drones to Kim Jong Un’s Airspace in Unprecedented MoveRussia Says Ukraine Must Surrender Even as Putin’s Army RetreatsAlameda Lent Sam Bankman-Fried $546 Milli
Merck (MRK) closed the most recent trading day at $112.12, moving +0.23% from the previous trading session.
Here is how Phillips 66 (PSX) and Patterson-UTI (PTEN) have performed compared to their sector so far this year.
Industrial technology company Cognex is going through a rough patch, but its long-term prospects remain excellent.
Not only are home values up, but mortgage rates are more than twice as high as they were a year ago. The benefit of refinancing a mortgage is getting to lock in a lower interest rate and reap savings.
Israeli Prime Minister-designate Benjamin Netanyahu moved one step further on Tuesday toward establishing a government after parliament approved divisive legislation agreed with his far-right coalition partners. Already facing criticism on policy before taking office, Netanyahu has vowed to govern for all Israelis even as he will head one of the most right-wing governments in the country's history with key ministries in the hands of hardliners. Despite a clear election win in November for his right-wing and religious bloc of parties, it has taken Netanyahu almost two months to reach deals with his allies, who have demanded a significant share of power in return for their support.
One of the main drivers of those outsized moves was a short squeeze, which is what can happen when short sellers who are betting against a stock get caught in a wrong-way position. One stock that Wall Street is bearish on now is Upstart Holdings (NASDAQ: UPST). Upstart has come under scrutiny this year as demand for consumer loans has fallen.
e.l.f. Beauty (ELF) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
It's no secret that Social Security is nearing a funding crisis that could threaten the financial security of millions of Americans who depend on it. Why is Social Security in trouble? Interest earned on Social Security's trust funds: The government invests any money taken in from the two above sources that's not needed for benefit payments in government-backed securities.
FDA officials tell the Wall Street Journal that safety concerns around CBD may cause the agency to publish its first guidelines on cannabis-derived products.
Amcor (AMCR) scales down Russia operations by selling its three factories in the country to HS Investments.
Back in May, Intercontinental Exchange (NYSE: ICE) and Black Knight Financial (NYSE: BKI) announced a deal in which Intercontinental Exchange would buy Black Knight for $85 share in cash and stock. The deal, valued at about $13 billion, would combine two of the biggest companies in the mortgage technology industry. Since then, the mortgage origination market has collapsed and the government is raising antitrust issues about the transaction.