CRC, NOG, and VTNR are top for value, growth, and momentum, respectively
The oil & gas
industry comprises upstream companies that explore and produce energy,
midstream pipeline companies that transport and store energy, and
downstream companies that refine oil and gas into finished products.
Additionally, there are companies that provide oilfield drilling
equipment and services. Some also manufacture and maintain equipment
used in production. The industry's biggest companies are
Netherlands-based Royal Dutch Shell PLC (RDS.A), U.K.-based BP PLC (BP), and Exxon Mobil Corp. (XOM).
Oil demand and prices collapsed in the spring of 2020 as COVID-19
prompted governments to shut down commerce and require millions of
people to stay at home. However, crude oil prices have recovered after
governments have gradually permitted businesses to reopen, and new
vaccines have opened the door to an economic recovery.
The oil & gas industry is best represented by the Energy Select Sector SPDR ETF (XLE).
While the energy sector consists of non-oil & -gas companies, its
dominant components are from the oil & gas industry. Therefore, the
energy sector's performance is a good benchmark for the oil & gas
sector as a whole. The XLE ETF posted a total return of 54.2% over the
last year, outperforming the Russell 1000's 37.1% total return.1 These market performance figures and all statistics in the tables below are as of Sept. 10, 2021.
Here are the top 3 oil and gas stocks with the best value, the fastest growth, and the most momentum.
These are the oil and gas stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio.
Because profits can be returned to shareholders in the form of
dividends and buybacks, a low P/E ratio shows you’re paying less for
each dollar of profit generated.
California Resources Corp.: California Resources is an independent oil and natural gas exploration & production (E&P) company with operations located in California.
Baytex Energy Corp.: Baytex Energy is a
Canada-based oil and gas company. It is focused on the acquisition,
development, and production of crude oil and natural gas in both Canada
and the U.S.
Surgutneftegas PJSC: Surgutneftegas is a
Russia-based oil and gas company engaged in exploration, drilling and
production, oil refining, and gas processing. Its E&P operations are
located in three of Russia's oil and gas provinces.
These are the top oil and gas stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth.
Both sales and earnings are critical factors in the success of a
company. Therefore, ranking companies by only one growth metric makes a
ranking susceptible to the accounting anomalies of that quarter (such as
changes in tax law or restructuring costs) that may make one or the
other figure unrepresentative of the business in general. Companies with
quarterly EPS or revenue growth of over 2,500% were excluded as
outliers.
Northern Oil & Gas Inc.: Northern Oil & Gas
is an independent energy company engaged in the acquisition,
exploration, development, and production of oil and natural gas
properties. Its operations are located in different regions throughout
the U.S. The company announced in early August that it was increasing
its quarterly common stock dividend by 50% compared to the prior
quarter. The dividend will be payable on Oct. 29, 2021 to shareholders
of record as of the close of business on Sept. 30, 2021.2
Northern Oil & Gas reported negative EPS in the most recent
quarter, which is why an EPS growth rate could not be calculated for the
above table.3
Spartan Delta Corp.: Spartan Delta is a
Canada-based oil and gas company engaged in the exploration,
development, and production of petroleum and natural gas properties in
western Canada. The company announced at the end of August that it has
completed its previously announced acquisition of Velvet Energy Ltd., a
privately held light-oil producer, for CA$751.5 million ($593.7
million).45
Continental Resources Inc.: Continental Resources
is a crude oil and natural gas company. It is focused on the exploration
and production of oil and natural gas properties in various regions
throughout the U.S. The company announced in late July that it would pay
a $0.15 quarterly dividend on Aug. 20, 2021, representing a 36.4%
increase from the dividend paid in Q2 2021.6
Continental Resources reported negative EPS in the year-ago quarter
compared to positive EPS in the most recent quarter, which is why an EPS
growth rate could not be calculated for the above table.7
These are the oil and gas stocks that had the highest total return over
the last 12 months. Companies with total returns over 2,500% were
excluded as outliers.
Vertex Energy Inc.: Vertex Energy is a specialty
refiner of alternative feedstocks and marketer of high-purity petroleum
products. The company supplies base oils to the lubricant manufacturing
industry in North America. Vertex Energy announced in late June that it
has agreed to sell its portfolio of used motor oil collection and
recycling assets to Safety-Kleen Systems Inc., a subsidiary of Clean
Harbors Inc. (CLH), for $140 million. The transaction is expected to close during the third quarter of 2021.8
SM Energy Co.: SM Energy is an independent energy
company engaged in the exploration, development, and production of crude
oil and natural gas. Its operations are located in various regions
throughout the U.S.
Centennial Resource Development Inc.: Centennial
Resource Development is an independent oil and natural gas company. It
is focused on developing oil and natural gas reserves in the Permian
Basin.
The comments, opinions and analyses expressed herein are for
informational purposes only and should not be considered individual
investment advice or recommendations to invest in any security or to
adopt any investment strategy. While we believe the information provided
herein is reliable, we do not warrant its accuracy or completeness. The
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