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3 Energy Stocks Priced Under $100 to Bet on Right Away
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Although crude price recently fell nearly 4% on concerns of global fuel demand, the commodity price is still highly favorable for exploration and production companies. This is due to the employment of premium drilling techniques that significantly lowered the operating costs of the upstream energy players. In fact, for most of the leading explorers and producers, the break-even oil price is well below $45, creating room for sustainable operations in a low crude pricing environment.
Midstream energy players are also well-positioned to gain amid energy market volatility. This is because they generate stable fee-based revenues from long-term bookings of transportation and storage assets by shippers for transporting natural gas and crude. Hence, their business model is relatively low-risk, which indicates considerably less exposure to oil and gas prices and volume risks.
Considering the current context, it's an opportune moment for investors to incorporate energy stocks into their portfolios. Notably, there are numerous energy stocks worth considering that are priced below $100 per share. Three such stocks are The Williams Companies, Inc. (WMB - Free Report) , Matador Resources Company (MTDR - Free Report) and Core Laboratories Inc. (CLB - Free Report) .
The Williams Companies is well-poised to capitalize on the mounting demand for clean energy since it is engaged in transporting, storing, gathering and processing natural gas and natural gas liquids.
With its pipeline networks spread across more than 30,000 miles, the company sports a Zacks Rank #1 at present. It connects premium basins in the United States to the key market. WMB’s assets can meet 30% of the nation’s consumption of natural gas, utilized for heating purposes and clean-energy generation.
The Williams Companies closed at $35.84 yesterday and has a very reasonable valuation. It trades at EV/EBITDA (Enterprise Value/Earnings before Interest Tax Depreciation and Amortization) ratio of 11.4, lower than its five-year average multiple of 11.72. It is to be noted that since oil and gas companies are debt-laden, it makes sense to value them based on the EV/EBITDA ratio.
Matador Resources has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Promising oil price is likely to aid it in increasing production volumes.
The company acquired Advance Energy Partners Holdings, LLC, in the largest deal in its two-decade history. MTDR, sporting a Zacks Rank #1 at present, expects the buyout to be accretive to important valuation and financial metrics since the deal involves a strategic bolt-on of 18,500 net acres in the core of the Northern Delaware Basin, a sub-basin of the prolific Permian Basin.
Matador closed at $53.48 yesterday and has a very reasonable valuation. MTDR trades at EV/EBITDA ratio of 4.81, lower than its five-year average multiple of 5.76.
As a well-known provider of patented reservoir description and production enhancement services, Core Laboratories is well-positioned to grow, thanks to the improving demand for its reservoir description services. The company, with a Zacks Rank of 2 at present, is focused on reducing its debt load.
Core Laboratories closed at $17.44 yesterday and has a reasonable valuation. CLB trades at EV/EBITDA ratio of 14.86, lower than its five-year average multiple of 18.58.
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3 Energy Stocks Priced Under $100 to Bet on Right Away
Although crude price recently fell nearly 4% on concerns of global fuel demand, the commodity price is still highly favorable for exploration and production companies. This is due to the employment of premium drilling techniques that significantly lowered the operating costs of the upstream energy players. In fact, for most of the leading explorers and producers, the break-even oil price is well below $45, creating room for sustainable operations in a low crude pricing environment.
Midstream energy players are also well-positioned to gain amid energy market volatility. This is because they generate stable fee-based revenues from long-term bookings of transportation and storage assets by shippers for transporting natural gas and crude. Hence, their business model is relatively low-risk, which indicates considerably less exposure to oil and gas prices and volume risks.
Considering the current context, it's an opportune moment for investors to incorporate energy stocks into their portfolios. Notably, there are numerous energy stocks worth considering that are priced below $100 per share. Three such stocks are The Williams Companies, Inc. (WMB - Free Report) , Matador Resources Company (MTDR - Free Report) and Core Laboratories Inc. (CLB - Free Report) .
For selecting these stocks, we have employed our proprietary Stock Screener. While one stock carries a Zacks Rank #2 (Buy) at present, the other two sport a Zacks Rank #1 (Strong Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Promising Stocks
The Williams Companies is well-poised to capitalize on the mounting demand for clean energy since it is engaged in transporting, storing, gathering and processing natural gas and natural gas liquids.
With its pipeline networks spread across more than 30,000 miles, the company sports a Zacks Rank #1 at present. It connects premium basins in the United States to the key market. WMB’s assets can meet 30% of the nation’s consumption of natural gas, utilized for heating purposes and clean-energy generation.
The Williams Companies closed at $35.84 yesterday and has a very reasonable valuation. It trades at EV/EBITDA (Enterprise Value/Earnings before Interest Tax Depreciation and Amortization) ratio of 11.4, lower than its five-year average multiple of 11.72. It is to be noted that since oil and gas companies are debt-laden, it makes sense to value them based on the EV/EBITDA ratio.
Matador Resources has a strong presence in the oil-rich core acres of the Wolfcamp and Bone Spring plays in the Delaware Basin. Promising oil price is likely to aid it in increasing production volumes.
The company acquired Advance Energy Partners Holdings, LLC, in the largest deal in its two-decade history. MTDR, sporting a Zacks Rank #1 at present, expects the buyout to be accretive to important valuation and financial metrics since the deal involves a strategic bolt-on of 18,500 net acres in the core of the Northern Delaware Basin, a sub-basin of the prolific Permian Basin.
Matador closed at $53.48 yesterday and has a very reasonable valuation. MTDR trades at EV/EBITDA ratio of 4.81, lower than its five-year average multiple of 5.76.
As a well-known provider of patented reservoir description and production enhancement services, Core Laboratories is well-positioned to grow, thanks to the improving demand for its reservoir description services. The company, with a Zacks Rank of 2 at present, is focused on reducing its debt load.
Core Laboratories closed at $17.44 yesterday and has a reasonable valuation. CLB trades at EV/EBITDA ratio of 14.86, lower than its five-year average multiple of 18.58.