3 Oil And Gas Stocks In Focus For May
MarketBeat.com | May 11, 2021 07:36AM ET
The energy sector has certainly been strong in 2021 thanks to a rebound in oil & gas prices and rising demand as the economy recovers from the impacts of the pandemic. You also have recent events like the hacking of a major U.S. pipeline company that could cause supply chain issues across the East Coast and result in a short-term increase in gas prices. All of this adds up to the possibility for a rally in oil & gas stocks during May.
While many of these companies have already moved considerably off of their pandemic lows, that doesn’t necessarily mean that they don’t have more upside. Some of these stocks are even breaking out of nice bases and could be poised to outperform in the short term. Let’s take a look at 3 oil & gas stocks in focus for May.h2 1. EOG Resources/h2
First up is EOG Resources (NYSE:EOG), which is one of the largest independent crude oil and natural gas companies in the world. With proven reserves in the US, Canada, offshore Trinidad, the UK, and China, this is a fine way to gain exposure to the energy sector with a tried and true business model. EOG also has been known to exceed industry averages in production rates from its shale wells and the company projects it will complete 500 net wells in 2021. It’s a company that is a major player in The Permian Basin and Eagle Ford Shale, which are two of the most oil-rich areas of land in the United States.
EOG Resources delivered Q1 earnings that beat estimates with adjusted EPS of $1.62 and adjusted EBITDA of $2.18 billion. The stock has rallied over 10% following the report last week and could be in for more upside if oil and natural gas prices continue heading higher in the coming weeks. This stock also offers investors a 1.99% dividend yield and the company declared a special dividend of $1.00 per share last week, making it a solid option for dividend investors at this time.
h2 2. Petroleo Brasileiro Petrobras/h2Another interesting oil and gas name to check out in May is Petroleo Brasileiro Petrobras (NYSE:PBR), which offers investors exposure to an emerging market in addition to energy. PBR is a mixed joint-stock corporation that is controlled by Brazil’s federal government and is another one of the largest oil and gas companies in the world. The company operates in five different segments that include exploration and production, refining, transportation and marketing, distribution, gas and power, and international. Since Brazil is such a massive country and Petrobras operates 13 refineries in Brazil with a capacity of 2.2 million barrels a day, investors can potentially capitalize on the country’s recovery from the impacts of COVID-19.
One of the important things to note about this company is the fact that it has access to pre-salt reservoirs that allow Petrobras to take advantage of a low-cost supply of oil that other global companies simply cannot match. The stock recently reclaimed its 200-day moving average and offers investors a 4.26% dividend yield, additional reasons why PBR is worth watching going forward. Just keep in mind that there is added risk here due to uncertainty surrounding Brazil’s economy and pandemic recovery at this time.
h2 3. Devon Energy/h2
Get The News You Want
Devon Energy (NYSE:DVN) is certainly another high-quality oil andgas name to consider in May, especially due to the recent acquisition of WPX Energy (NYSE:WPX) that could dramatically boost the company’s cash flows going forward. The acquisition should be applauded by investors because it greatly expands the company’s footprint in the productive Delaware Basin without adding a lot of debt to Devon’s balance sheet. The company also has assets in Eagle Ford, STACK, Powder River Basin, and Bakken, which are some of the best locations for oil and gas in the United States.
The stock has been trending nicely after the company reported earnings that were slightly better than expected and could be a great option to capitalize on the strength in the energy sector this month. Devon Energy stock also offers investors a 1.68% dividend yield and recently increased its fixed-plus-variable dividend payout by 13%, which shows that the company is committed to rewarding long-term shareholders.
Original Post
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.