It operates in every segment of the oil and gas industry, including E&P, midstream, petrochemical manufacturing, refining, and, even further downstream, marketing refined and petroleum products to customers. Additionally, investors must consider the implications of climate change on the long-term prospects of oil and gas. The energy sector is undergoing a massive transition to renewable energy. Here’s a closer look at some of the top oil stocks and factors to consider before buying. Your capital will compound to $103,417.10 in 20 years, including dividend reinvesting.
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- The U.S. struck a deal with the European Union earlier this year aimed at reducing the bloc’s reliance on natural gas from Russia.
- For those looking for exposure to a basket of oil stocks, there are a wide-range of oil exchange-traded funds (ETFs).
- Note well that $1.1 billion in FCF would represent almost a third of PDCE’s entire market value.
- That lets me own a growing energy business and a growing renewable power business with one single investment.
The Best Oil Stocks to Buy Right Now With $500
One good integrated energy stock will help to keep your investing, which will likely include far more than just energy stocks, manageable. Because it has a strong, Best oil stock cash-rich balance sheet, Devon was able to continue returning more cash to shareholders. The oil company paid its regular quarterly dividend of $0.22 per share.
Considerations When Buying Oil Assets
This includes drilling gear, testing and safety tools, and other heavy-duty components. Many, or all, of the products featured on this page are from our advertising partners who compensate https://investmentsanalysis.info/ us when you take certain actions on our website or click to take an action on their website. The increase was driven by greater production in the oil-rich Permian Basin.
Can you diversify with oil stocks?
Devon Energy returned an additional $256 million to shareholders by repurchasing 5.2 million shares during the quarter. It has now repurchased 54.7 million shares for $2.7 billion since it initiated its current share-repurchase authorization in late 2021. These are the oil and gas stocks that had the highest total return over the past 12 months.
Investing in Oil Stocks: Top Oil Stocks to Buy
And it isn’t giving up on oil and natural gas, with a goal of growing both its energy business (with a shift toward cleaner-burning natural gas) and its “electrons” business at the same time. That lets me own a growing energy business and a growing renewable power business with one single investment. Seventeen analysts covering DVN tracked by S&P Global Market Intelligence call it one of the best oil stocks to buy now, at Strong Buy. They expect the firm to deliver average annual EPS growth of 6% over the next three to five years.
However, oil prices have steadily fallen in recent months as concerns grow about the prospects of a global recession, and the impact that anti-Covid-19 lockdowns in China will have on energy demand. This makes TotalEnergies something of a punt option in the oil space for investors who recognize that clean energy is going to be increasingly important. You could try to pick a winner in the clean energy sector, but it is still very early in the energy transition. Allowing a financially strong company like TotalEnergies to handle the shifting currents in the sector is probably a safer alternative for most investors.
Among oil companies, those that are focused primarily on exploration and extraction of oil from the ground tend to react the most when oil prices spike or crash. Those that have more integrated businesses, adding elements like selling refined product to consumers or transporting oil over great distances, have a more constant revenue stream, regardless of the price of oil. They run the gamut from pure-play exploration and production companies (E&Ps), midstream businesses, service providers, and refiners to integrated oil majors that do a little bit of everything. Founded in 1993, The Motley Fool is a financial services company dedicated to making the world smarter, happier, and richer. The Motley Fool reaches millions of people every month through our premium investing solutions, free guidance and market analysis on Fool.com, top-rated podcasts, and non-profit The Motley Fool Foundation. On the whole, the pros see Diamondback as one of the best oil stocks you can buy now.
If you’re looking for more direct exposure to oil, you can consider looking to the commodities market, where there are products such as oil futures for sale. Jones, however, says such investments can be risky for retail investors. But diversified investment portfolios should always include a wide array of stocks and sectors, regardless of which sectors and stocks are hot. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Enbridge has made significant investments in recent years on infrastructure geared toward cleaner energy, including offshore wind energy in Europe and hydrogen.
“PXD is building a powerhouse of a Permian Basin play, with no federal land exposure,” writes CFRA Research analyst Stewart Glickman, who rates shares at Buy. “We are somewhat surprised by the timing of this deal, coming so soon after closing the Parsley acquisition [in January], but we think PXD is being opportunistic.” With an average price target of $30.35, the Street gives this oil stock implied upside of about 38% in the next 12 months or so.
Buffett no doubt likes that OXY stock nearly doubled in 2022, making it one of the best-performing stocks in the S&P 500. He also certainly likes Occidental Petroleum’s low P/E ratio of 5.3. The downside here is that TotalEnergies is French, and investors have to pay foreign taxes, some of which can be claimed back come tax time. But that’s an expense and hassle that you avoid with Exxon and Chevron. The accretive nature of that transaction is giving Devon Energy the confidence to significantly increase its share-repurchase authorization.
