Displaying items by tag: energy

(Houston)

Environmentally, Social and Corporate Governance (ESG) investing is getting all of the attention from both news outlets and traders, but some investors think too much attention is being diverted from fossil fuels. They argue that oil is now a sin stock, where many investors stay away because of the nature of the good (e.g. alcohol, defense, gambling, and tobacco). Sin stocks traditionally outpace the market, under the wisdom that they remain perpetual value stocks because socially conscious investors stay away, and oil ETFs are starting to outperform renewable ETFs. In reality, sin stocks don’t get their boost from value but rather higher operating margins, and oil is one of the most competitive with low to negative margins depending on how far upstream the extraction is. While oil is moving out of environmental favor it isn’t quite a sin stock yet because it also lacks the capital intensity that is common to sin stocks.

FINSUM: There are a lot of reasons to be bullish on oil right now, but being sin stock probably isn’t one. Oil can still be a value play even if that’s not how sin stocks make their name.

(Houston)

Oil prices pushed up to $65 a barrel early in the week. Most investors…see the full story on our partner Magnifi’s site

(Shanghai)

China is one of the biggest importers of crude oil and…see the full story on our partner Magnifi’s site

(Washington)

Treasury Secretary Janet Yellen released bits of the Biden administration's Future Tax plan…see the full story on our partner Magnifi’s site

(New York)

It is no secret that oil and gas stocks have great dividends. What makes the sector special right now is that the sector is also looking like a good investment for capital appreciation because of the rise of the “commodities super cycle”. With all that in mind, check out these three names for good income: Marathon Petroleum (MPC) or its MLP, MLPX, Energy Transfer (ET), and Antero Resources (AR). All three opportunities currently offer double digit yields.

FINSUM: Oil is definitely in recovery mode, so the combination of value and income is compelling.