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Zacks Value Investor Highlights: Energy Select SPDR, Exxon Mobil, Valero Energy, Schlumberger and EOG Resources
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For Immediate Release
Chicago, IL – December 12, 2022 – Zacks Value Investor is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
Energy has been the best performing sector in the S&P 500 in 2022. It also held that title in 2021. Can energy keep its crown 3 years in a row?
Many traders are dubious. Energy stocks have already weakened in Dec 2022 as crude and natural gas prices have eased from recent highs.
But energy stocks are still cheap, on a P/E basis, and free cash flows are still elevated with WTI crude over $65. It’s been trading over $70 the last six months.
But will all energy stocks rise, as they have been the last 2 years? Or will one part of the industry rise above the rest?
The XLE is one of the top energy ETFs. It was created in 1998, at the start of the last energy bull market. The XLE has 22 holdings across all aspects of the industry from the producers, to refiners, marketing, and the integrated oil companies.
Exxon Mobil and Chevron are the two largest holdings and make up 42.58% of the total portfolio. If you want a big position in the two largest integrated oil companies in the United States, then the XLE is for you.
Shares of XLE are up 51% year-to-date and over the last 2 years are up 104%.
It has an expense ratio of 0.1% and currently pays a dividend yielding 3.4%.
Valero is a refiner. The refining industry has a Zacks Industry Rank in the top 18%.
Shares of Valero have been on a tear in 2022, gaining 54% year-to-date. It’s still dirt cheap, however, with a forward P/E of just 4.3.
Earnings have soared in 2022, with analysts expecting them to jump 894% to $27.95 from just $2.81 last year. But in 2023, earnings are expected to fall 29%.
Schlumberger is in oil field services globally. Oilfield services has a Zacks Industry Rank in the top 9% of all Zacks industries. It ranks 23 out of 250 industries.
Shares of Schlumberger are up 64% year-to-date but the stock isn’t as cheap as some of the others. It trades with a forward P/E of 24.
However, earnings are still expected to be on the rise. Earnings are forecast to rise 67.9% in 2022 and another 40.6% in 2023 as producers ramp up oil and natural gas production next year.
Should oil field service companies like Schlumberger be on your short list?
EOG Resources is an exploration and production company. The E&Ps no longer have a high Zacks Industry Rank. The E&P industry ranks in the bottom 32%, or 172 out of 250 industries.
Shares of EOG Resources are up 38% year-to-date, but have weakened over the past month, falling 17% during that time. EOG Resources is still cheap, with a forward P/E of just 9.
Earnings of the producers are directly correlated to the price of oil and natural gas, both of which have come down in recent months. Analysts expect EOG Resources earnings to grow just 5% in 2023.
Is the recent weakness in EOG Resources a buying opportunity in the stock?
What Else Should You Know About Energy Stocks Heading into 2023?
Tune into this week’s podcast to find out.
Why Haven’t You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Value Investor Highlights: Energy Select SPDR, Exxon Mobil, Valero Energy, Schlumberger and EOG Resources
For Immediate Release
Chicago, IL – December 12, 2022 – Zacks Value Investor is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:
https://www.zacks.com/stock/news/2027459/can-energy-stocks-win-again-in-2023
Can Energy Stocks Win Again in 2023?
Welcome to Episode #309 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
Energy has been the best performing sector in the S&P 500 in 2022. It also held that title in 2021. Can energy keep its crown 3 years in a row?
Many traders are dubious. Energy stocks have already weakened in Dec 2022 as crude and natural gas prices have eased from recent highs.
But energy stocks are still cheap, on a P/E basis, and free cash flows are still elevated with WTI crude over $65. It’s been trading over $70 the last six months.
But will all energy stocks rise, as they have been the last 2 years? Or will one part of the industry rise above the rest?
5 Ways to Invest in Energy Stocks in 2023
1. Energy Select SPDR (XLE - Free Report)
The XLE is one of the top energy ETFs. It was created in 1998, at the start of the last energy bull market. The XLE has 22 holdings across all aspects of the industry from the producers, to refiners, marketing, and the integrated oil companies.
Exxon Mobil and Chevron are the two largest holdings and make up 42.58% of the total portfolio. If you want a big position in the two largest integrated oil companies in the United States, then the XLE is for you.
Shares of XLE are up 51% year-to-date and over the last 2 years are up 104%.
It has an expense ratio of 0.1% and currently pays a dividend yielding 3.4%.
Should investors still be buyers of XLE in 2023?
2. Exxon Mobil Corp. (XOM - Free Report)
Exxon Mobil is a large integrated oil company. The integrated oil companies have a Zacks Industry Rank in the top 27%.
Shares of Exxon Mobil are up 71% year-to-date but are still cheap, on a P/E basis. Exxon Mobil has a forward P/E of just 7.5.
However, earnings are expected to decline 21.4% next year after 2022’s big year.
Is it too late to buy Exxon Mobil?
3. Valero Energy Corp. (VLO - Free Report)
Valero is a refiner. The refining industry has a Zacks Industry Rank in the top 18%.
Shares of Valero have been on a tear in 2022, gaining 54% year-to-date. It’s still dirt cheap, however, with a forward P/E of just 4.3.
Earnings have soared in 2022, with analysts expecting them to jump 894% to $27.95 from just $2.81 last year. But in 2023, earnings are expected to fall 29%.
Valero pays a dividend, yielding 3.3%.
Should investors consider the refiners in 2023?
4. Schlumberger Ltd. (SLB - Free Report)
Schlumberger is in oil field services globally. Oilfield services has a Zacks Industry Rank in the top 9% of all Zacks industries. It ranks 23 out of 250 industries.
Shares of Schlumberger are up 64% year-to-date but the stock isn’t as cheap as some of the others. It trades with a forward P/E of 24.
However, earnings are still expected to be on the rise. Earnings are forecast to rise 67.9% in 2022 and another 40.6% in 2023 as producers ramp up oil and natural gas production next year.
Should oil field service companies like Schlumberger be on your short list?
5. EOG Resources, Inc. (EOG - Free Report)
EOG Resources is an exploration and production company. The E&Ps no longer have a high Zacks Industry Rank. The E&P industry ranks in the bottom 32%, or 172 out of 250 industries.
Shares of EOG Resources are up 38% year-to-date, but have weakened over the past month, falling 17% during that time. EOG Resources is still cheap, with a forward P/E of just 9.
Earnings of the producers are directly correlated to the price of oil and natural gas, both of which have come down in recent months. Analysts expect EOG Resources earnings to grow just 5% in 2023.
Is the recent weakness in EOG Resources a buying opportunity in the stock?
What Else Should You Know About Energy Stocks Heading into 2023?
Tune into this week’s podcast to find out.
Why Haven’t You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Insider Trader and Value Investor services. You can follow her on twitter at @TraceyRyniec and she also hosts the Zacks Market Edge Podcast on iTunes.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.