|Bid||0.00 x 2200|
|Ask||55.17 x 36900|
|Day's Range||0.00 - 0.00|
|52 Week Range|
|PE Ratio (TTM)||N/A|
|YTD Daily Total Return||-5.82%|
|Beta (5Y Monthly)||1.38|
|Expense Ratio (net)||0.13%|
The energy sector is comprised of companies focused on the exploration, production, and marketing of oil, gas, and renewable resources around the world. Well-known companies in this group include Occidental Petroleum Corp. (OXY) and EOG Resources Inc. (EOG). Downstream companies that include HollyFrontier Corp. (HFC) refine and process oil and gas products for delivery to consumers .
The energy sector is suffering a broad selloff, and is the worst performer of the S&P 500's 11 key sectors, amid increasing worries that the deadly coronavirus would weigh on economic growth and sap demand for crude oil. The SPDR Energy Select Sector ETF dropped 2.5% toward a 13-month low, with all 28 components losing ground. The ETF has now dropped 6.6% in the past week as the coronavirus out of Wuhan made headlines. Halliburton Co.'s stock was the biggest loser Monday, shedding 5.0%. Among the other more-active components, shares of Schlumberger Ltd. slid 4.7%, Exxon Mobil Corp. declined 1.9%, Marathon Oil Corp. lost 2.0% and Kinder Morgan Inc. slipped 0.8%. Meanwhile, crude oil futures shed 2.8%, and were on track to settle at a 3 1/2-month low. The selloff comes as the S&P 500 dropped 1.6%. Separately, Marathon Oil was upgraded by Stifel Nicolaus analyst Derrick Whitfield, who picked Monday to raise his rating to buy, after being at hold for at least the past three years. Whitfield said he's now bullish because of the company's commitment to shareholder returns and improving capital efficiency. The company also offers investors lower than average execution risks.
Shares of Chesapeake Energy Corp. fell 1.7% toward a 26-year low in active morning trading Monday, amid worries that the rapidly spreading deadly coronavirus would weaken demand for crude oil. The oil and gas company's stock was on track for the lowest close since April 1994, as continuous crude oil futures dropped 1.8% toward a 3 1/2-month low. Chesapeake Energy's stock has now plunged 64.8% over the past three months, while crude futures has lost 6.0%, the SPDR Energy Select Sector ETF has declined 6.9% and the S&P 500 has gained 7.5%.
Marathon Petroleum Corp. said Monday it will raise it quarterly dividend by 9.4%, to 58 cents a share from 53 cents. The stock was still inactive in premarket trading. The new dividend will be payable March 10 to shareholders of record on Feb. 19. Based on Friday's stock closing price of $54.49, the new annual dividend rate implies a dividend yield that rises to 4.26% from 3.89%. In comparison, the SPDR Energy Select Sector ETF's dividend yield as of Friday was 3.96% and the implied yield for the S&P 500 was 1.82%, according to FactSet. Marathon Petroleum's stock has tumbled 19.9% over the past three months, while the energy ETF has lost 4.9% and the S&P 500 has gained 9.0%.
The corporate earnings season is in full swing, but it does not look rosy for the energy sector and related exchange traded funds. The Energy Select Sector SPDR Fund (XLE) has already been underperforming the broader market as it dipped 4.6% so far in the new year, compared to the S&P 500's 3.1% gain. The poor performance reflects traders' expectations of a weak earnings season for the sector.
Yahoo Finance speaks exclusively with Aramco Chairman Yasir Al-Rumayyan about climate change and the future of the oil industry.
Baker Hughes Co. reported Wednesday fourth-quarter profit and revenue that rose less than expected, as beats in oilfield services and turbomachinery and process solutions revenue was offset by a miss in oilfield equipment. The stock was still inactive in premarket trading. Net income fell to $48 million, or 7 cents a share, from $131 million, or 28 cents a share, in the year-ago period. Excluding non-recurring items, adjusted earnings per share grew to 27 cents from 26 cents, but were below the FactSet consensus of 31 cents. Revenue increased 1% to $6.35 billion, missing the FactSet consensus of $6.48 billion. Orders increased 1% to $6.94 billion. Oilfield services revenue rose 7% to $3.29 billion, above the FactSet consensus of $3.28 billion; turbomachinery revenue fell 8% to $1.32 billion, below expectations of $1.82 billion; oilfield equipment revenue rose 5% to $765 million, beating expectations of $753 million. The stock has gained 0.4% over the past three months, while the SPDR Energy Select Sector ETF has slipped 1.3% and the S&P 500 has gained 10.8%.
Compared to the broader market, energy stocks weren't the stocks to own last year. The Energy Select Sector SPDR (NYSEARCA:XLE) rose just 11.7%, including dividends paid, against a 31.2% gain for the S&P 500.Also consider that the energy sector saw its weight within the S&P 500 dwindle to its lowest levels since the 1980's. Dow component Exxon Mobil (NYSE:XOM) dropped out of the top 10 S&P 500 names for the first time on record. That stock and rival Chevron (NYSE:CVX) yield an average of 4.60%, making them two of the "dogs of the Dow" for 2020.Increased adoption and falling costs for renewable energy sources coupled with the the persistent skewering of fossil fuel producers by the virtuous investing crowd, including some institutional investors, made for a perfect storm of difficulty for traditional energy equities last year.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThere is some good news to consider with energy exchange-traded funds this year, including the sector's status as a value destination, improving free cash flow among larger producers and an ongoing need for oil throughout the world. * 7 Top-Rated Stocks to Buy for a More Powerful Portfolio For investors looking to bet on better things for the energy sector this year, here are some energy ETFs to consider. Energy ETFs to Buy: Fidelity MSCI Energy Index ETF (FENY)Expense Ratio: 0.084%, or $8.40 annually per $10,000 investedThe Fidelity MSCI Energy Index ETF (NYSEARCA:FENY) is a solid idea for investors willing to make a long-term commitment to traditional energy names because the fund is the least expensive energy ETF on the market and is heavily allocated to higher quality fare, such as Exxon and Chevron.Another reason to consider big-name energy stocks, particularly in basket form as offered by FENY, is that the group is becoming more committed to shareholder rewards, such as buybacks and dividends to support stagnant price appreciation."Energy stocks have been out of favor for the five-year period ending October 31, 2019. Energy has been the worst-performing of the 11 sectors in the S&P 500 during that time, with an annualized return of -4.95%, and the only sector with a negative return," said Fidelity in a recent note. "Meanwhile, the S&P 500 index is up 10.78% per year over the same period. As a result, more energy companies have shifted attention from production to profitability and shareholder-friendly efforts, even amid historically low crude oil prices." Alerian Energy Infrastructure ETF (ENFR)Expense Ratio: 0.65%One part of the energy patch that's showing some strength early this year is the midstream. The Alerian Energy Infrastructure ETF (NYSEARCA:ENFR) is higher by 2.5% and is proving to be a more reliable bet than more traditional energy ETFs. That comes after midstream equities were the top performers in the energy sector in 2019.ENFR follows the Alerian Midstream Energy Select Index, one of the most widely followed midstream benchmarks. The midstream dedication is relevant at a time when those companies are working to reduce debt and burdensome incentive distribution rights (IDRs). * 7 Earnings Reports to Watch Next Week "Our long-term outlook for midstream oil and gas companies is unchanged, but we could change our fair value estimates depending on whether new and material investment projects are sanctioned in response," said Morningstar in a recent note. "We think midstream companies that could benefit from higher demand for export infrastructure and related pipelines, wider differentials, and higher demand for liquefied natural gas, given oil-linked contracts." VanEck Vectors Energy Income ETF (EINC)Expense Ratio: 0.45%The VanEck Vectors Energy Income ETF (NYSEARCA:EINC) is impressing on two fronts to start the new year. First, its 9.40% dividend is a whopper, even among energy ETFs designed to be income plays. Second, and more importantly, the fund is up 3% this month.EINC targets the MVIS North America Energy Infrastructure Index, "which is intended to track the overall performance of North American companies involved in the midstream energy segment, which includes MLPs, and corporations involved in oil and gas storage and transportation," according to VanEck.Although they're not integrated energy firms or energy and production companies, EINC components are levered to the growing U.S. energy export story."This significant growth in North American oil and gas production has increased the need for supporting infrastructure, including new pipelines connecting producing regions with demand centers and the coast for export," said VanEck in a recent note. "A 2018 study by the Interstate Natural Gas Association of America estimated that an investment of $521 billion in midstream energy infrastructure is needed in the U.S. and Canada by 2035." iShares Global Energy ETF (IXC)Expense Ratio: 0.46%The iShares Global Energy ETF (NYSEARCA:IXC) combines domestic oil giants, such as Exxon and Chevron, with international equivalents, including BP Plc (NYSE:BP), Royal Dutch Shell (NYSE:RDS.A) and France's Total (NYSE:TOT).Not only does that give the fund some geographic diversity, it offers investors deeper value and higher dividends, two traits applicable to European oil majors. IXC's ex-U.S. components offer some other benefits. * 10 Stocks to Buy as the 2020 Presidential Election Approaches "One of their big draws: Many non-US energy companies tend to have higher exposure to high-growth prospect drilling regions such as the Middle East, Asia Pacific and Africa than their stateside brethren -- not to mention that some are generous dividend payers, too," reports OilPrice.com. FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR)Expense Ratio: 0.46%The FlexShares Morningstar Global Upstream Natural Resources Index Fund (NYSEARCA:GUNR) can augment midstream energy ETFs because this fund focuses on the upstream segment. However, GUNR isn't a dedicated energy ETF. It also features exposure to materials and mining names, giving investors broader exposure to equities that can benefit from favorable commodities cycles.GUNR reflects the value propositions offered by the energy and materials sectors as more than 44% of the fund's holdings are classified as value stocks, more than triple its weight to equities with the growth designation. Another perk: GUNR devotes almost two-thirds of its roster to ex-U.S. stocks, giving it a yield of 3.22%, well in excess of the S&P 500.Overall, GUNR is a compelling option for investors seeking a broad approach to real assets."[I]nvestors continue to benefit from innovation within a variety of investment vehicles that focus on real assets," notes FlexShares. "Furthermore, strong demand for real assets is being met with an unprecedented supply of opportunities for investment, and we believe trends indicate that it will continue to grow. The Real Assets classification (e.g., timber, water, infrastructure, natural resources, etc.) is continually evolving, influenced not only by new asset types, but also regulatory and issuance changes." VanEck Vectors Oil Services ETF (OIH)Expense Ratio: 0.35%The VanEck Vectors Oil Services ETF (NYSEARCA:OIH) is an energy ETF for risk tolerant investors because oil services stocks are usually intimately correlated to crude prices. Translation: OIH is a great place to be if oil prices are rising, but if crude prices are falling, this fund can sting its owners.An issue facing oil services providers this year is lower spending forecasts by integrated oil companies and exploration and production firms in the face of low crude prices. A recent IHS Markit poll indicates global investors are comfortable betting on a "cyclical" rebound for energy stocks, a theme that if valid, should matriculate to oil services equities. * 10 Cheap Stocks to Buy Under $10 "Still, 67% of respondents believe that there is potential for the industry to experience a cyclical reversion in the stock market and come back into favor with equity investors," according to the research firm. "They believe that a rotation back into the energy sector is contingent on the supply-demand balance, conservative capital strategies and an improving outlook for the global macro and trade tensions." Global X MLP ETF (MLPA)Expense Ratio: 0.45%The Global X MLP ETF (NYSEARCA:MLPA) is another option for investors looking to access the midstream, a compelling and undervalued area of the energy patch."Midstream is one of the most undervalued asset classes across the equity universe. And the strength of the cash flows and dividend coverage makes for a more positive asset class outlook in 2020," according to Global X research.Importantly, dividends in the midstream space have more than adequate coverage, a positive for investors looking to tap MLPA for added income."Dividend coverage ratios for the asset class are cushioned by 30% on average and price-to-cash flow valuations are trading at early-2016 levels of 5x when oil prices were hitting rock bottom," said Global X.As of this writing, Todd Shriber did not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Monthly Dividend Stocks to Buy to Pay the Bills * 7 Earnings Reports to Watch Next Week * 7 5G Stocks to Connect Your Portfolio To The post 7 Energy ETFs to Buy for a Rebound in 2020 appeared first on InvestorPlace.
Shares of McDermott International Inc. tumbled 15% in premarket trading Tuesday, after the provider of engineering and construction services to the energy industry announced a prepackaged bankruptcy as part of a restructuring that eliminates $4.6 billion of debt. The company said the bankruptcy will be financed by a debtor-in-possession (DIP) financing facility of $2.81 billion, and that it has secured over $2.4 billion in letter-of-credit facility capacity. The company said it expects to emerge from bankruptcy with about $500 million in funded debt. As part of the DIP agreement, McDermott will sell its Lummus Technology business for $2.73 billion, with the proceeds from the sale expected to be used to repay the DIP financing in full. McDermott expects its stock to be delisted from the NYSE within the next 10 days. The stock is proposed to be cancelled as part of restructuring. McDermott's stock had plummeted at the end of 2019, with The Wall Street Journal reporting that McDermott had been in talks with its lenders for a bankruptcy filing within weeks. McDermott shares have lost 92.2% of their value over the past 12 months through Friday, while the SPDR Energy Select Sector ETF has declined 7.4% and the S&P 500 has gained 24.7%.
As China promises to increase purchases of oil and gas from the United States under the phase-one trade deal, we highlight some ETFs that can gain.
J.P. Morgan initiated coverage of Saudi Arabian Oil Co. , known widely as Saudia Aramco, with an overweight rating and a price target of 37.00 Saudi riyals per share, which is 6.6% above current levels and suggests a fair value for the oil giant of $2 trillion. That valuation compares with the S&P 500's largest U.S. energy company by market capitalization, Exxon Mobil Corp. , at $292.8 billion. Analyst Christyan Malek said key drivers for Aramco include an "increased appetite" from the Kingdom of Saudia Arabia to regain market share of global oil demand, in the context of a tightening of oil market deficit, and a rising call from captive refining commitments. "Aramco effectively offers minority shareholders 'bond with equity upside' type properties," Malek wrote in a note to clients. "Premium barrels, capex flexibility, captive crude demand through vertical integration into the eastern hemisphere (where we expect most marginal LT growth to emerge) and low gearing enable Aramco to commit to distributing a structurally higher percentage of cashflow through the cycle." The stock,which went public on Dec. 12, has declined 5.7% since then, while the SPDR Energy Select Sector ETF has slipped 1.5% and the S&P 500 has gained 3.6%.
The movements in these sector ETFs should be watched closely as the phase-1 trade deal is being signed and there is no tariff relief for a huge chunk of goods until phase-2.
Shares of Chesapeake Energy Corp. sank 5.2% in active afternoon trading Monday, putting them on track for a 4th-straight loss, as crude oil futures continued to sell off amid the perception of reduced tensions in the Middle East. Chesapeake's stock, which was the second-most active on NYSE with 36.8 million shares traded, has tumbled 23% during its losing streak, and is headed for the lowest close since Dec. 3. Continuous crude oil futures shed 1.1%, and have dropped 7.7% amid a 5-day losing streak. Chesapeake's stock has lost 50.2% over the past three months, while the SPDR Energy Select Sector ETF has gained 3.0% and the S&P 500 has climbed 10.5%.
Traditional dividend havens such as utilities and real estate investment trusts are expected to continue that role, with yields in the 3% range this year. Those looking for more robust dividend growth should consider sectors such as health care and technology.
Exchange-traded funds with energy holdings fell sharply Wednesday midday as the oil price sank along with investor concerns about a protracted conflict in the Middle East. The SPDR S&P Oil & Gas Exploration & Production ETF had lost 3.4% by late morning, while the Energy Select Sector SPDR Fund was down 1.6%, as crude oil slumped nearly 4%. It was the biggest one-day decline for XOP since Sept. 17, when it lost 5.3%, according to FactSet. The two ETFs take different approaches to tracking energy stocks: XLE is more exposed to larger oil and gas companies, with 22.3% of its holdings in Exxon Mobil Corp. and nearly 20% in Chevron Corp. . In contrast, XOP invests equally in about 60 securities representative of the broader exploration and production industry, raning from Apache Corp. , which at 3.3% is its biggest holding, to WPX Energy Inc. .
Energy stocks have lagged the broader market for the past year and past decade -- but they could be the trade of the 2020s, according to David Mazza of Direxion.
Shares of Apache Corp. rocketed 26% on heavy volume Tuesday, putting them on track for the biggest one-day gain since 1973, after the oil and gas exploration company announced a "significant oil discovery" off the shore of Suriname in South America. The rally was enough to pace all the stocks in the S&P 500 that were gaining ground. Trading volume swelled to 20.4 million share, nearly triple the full-day average. Apache said the discovery was at the Maka Central-1 well drilled offshore Suriname on Block 58, which was drilled using the drillship Noble Sam Croft with both Apache and Total S.A. holding 50% working interests. BofA Merrill Lynch analyst Doug Leggate followed by upgraded Apache to buy from neutral and raising the stock price target to $36 from $28, saying the discovery is a "potential game changer" for the investment case for Apache. The stock, which is heading toward its best one-day performance since it rose 30.8% on Sept. 25, 1973, has now gained 10.6% over the past 12 months, while the SPDR Energy Select Sector ETF has slipped 0.9% and the S&P 500 has gained 27.1%.
Energy stocks and exchange-traded funds (ETFs) were a miserable bet in 2019. Indeed, the energy sector was the worst-performing sector by a mile, gaining less than 5% - far below the S&P; 500's 29% return, and significantly lagging even the second worst sector, health care (18%).However, despite tepid analyst outlooks for oil and gas prices in 2020, energy ETFs and individual stocks are suddenly being thrust in the spotlight once more.On Jan. 2, the Pentagon confirmed that the U.S. military killed Qasem Soleimani - a top Iranian general who headed the Islamic Revolutionary Guard Corps' elite Quds Force - with a drone airstrike in Iraq. While the Pentagon said the attack was meant to deter "future Iranian attack plans," Iran nonetheless has vowed "severe revenge." The clear, abrupt escalation in Middle East tensions immediately sent oil prices higher in response.Whether oil continues to climb is unclear. Tensions could de-escalate. Also, American fracking has changed the playing field. "The major potential risk - to oil markets - is mitigated by the fact that the U.S. is now the largest producer of oil and essentially approaching Energy independence," says Brad McMillan, Chief Investment Officer for Commonwealth Financial Network. "Our oil supplies are much less vulnerable than they were, and the availability of oil exports from the U.S. means that other countries have an alternative source." However, if the conflict worsens - especially if oil tankers and infrastructure are targeted in any violence - oil might continue to spike, regardless.Here, we explore five energy ETFs to buy to take advantage of higher oil prices. But approach them with caution. Just like increases in crude-oil prices should benefit each of these funds in one way or another, declines in oil have weighed on them in the past, and likely would again. SEE ALSO: The 20 Best ETFs to Buy for a Prosperous 2020
All three major indexes closed at record highs on Friday, led by a week of strong economic data and corporate earning results. The Final Round panel discusses the markets at the closing bell.
Oil shares popped on Wednesday after President Donald Trump finalized the first stage of a trade deal with China. However, a new report from the International Energy Agency warns that oil production from PEC countries is still expected to outstrip supply. Dan Dicker, founder of The Energy Word, joins The Final Round to discuss what investors should expect from the oil industry in 2020.
Stifel Head of Institutional Equity Strategy Barry Bannister joins the On The Move panel to discuss the best cyclical sectors to invest in as the federal reserve continues to hold on rate cuts.
Despite heightened geopolitical tension between the United States and Iran, domestic markets closed higher on Wednesday, with both the S&P 500 and the Nasdaq hitting record highs.