- (1:15) - Is OPEC Losing Control Of Oil Prices?
- (5:40) - What Is The Cause Behind the Falling WTI (West Texas Intermediate)
- (8:00) - OPEC Against The Permian Basin And Recent U.S M&A Activity
- (13:30) - What Is A Good Target Price On Oil?
- (17:30) - Big Oil Stocks To Watch: CVX, OXY & XOM
- (20:00) - E&P Stocks On The Radar: PXD, HPR, FANG & LLEX
- (25:05) - Are Oil Services Taking A Hit? (SLB, RES & GE)
- (28:45) - Are MLPs Are Safer Way To Play The Oil Industry? (EPD)
- (33:50) - Episode Roundup: Podcast@Zacks.com
Welcome to Episode #154 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.
In this episode, Zacks Director of Research, Sheraz Mian, joins the podcast to discuss what is going on in the oil patch and with the energy stocks.
For 3 years, since the first energy Market Edge podcast made its debut in December 2015, Tracey and Sheraz have dissected the energy markets and made their predictions.
But with crude recently having its largest 1-day sell off in 3-years, and signaling its plunge may not be over soon, it’s time to take another look at the sector.
A lot of the energy stocks have hit new 52-week or multi-year lows.
Should investors be buying the energy stocks again?
Energy Stocks: Where to Begin
The energy sector is large. It ranges from the Big Oil companies, to the smaller exploration and production companies (the “E&Ps”), to oil services, to refiners as well as the MLPs.
Not all of them are at new lows. And some will be more volatile than others.
Tracey and Sheraz discuss the areas investors need to focus on within the sector.
Big Oil is the Most Stable
Not surprisingly, the diversified “Big Oil” companies like Exxon (XOM - Free Report) and Chevron (CVX - Free Report) offer the most stability to investors.
Exxon is down only 8.3% year-to-date while Chevron is down just 9.5%.
Investors also get juicy dividends, currently yielding 4.1% for Exxon and 3.6% for Chevron.
It Takes Guts to Buy the E&Ps
One of the most volatile areas of the energy sector is the E&Ps. They move higher when crude rises, and lower when crude prices fall.
And with crude plunging, that means they’ve been taking it on the chin lately.
But that also means there are buying opportunities there.
Sheraz likes the big Permian Basin plays like Pioneer Natural Resources (PXD - Free Report) and Diamondback Energy (FANG - Free Report) . Pioneer is down 13% year-to-date while Diamondback Energy has fallen 15.7%.
For a small E&P play in the Permian, check out Lilis Energy (LLEX - Free Report) . It’s currently trading under $5 because shares are down 58% year-to-date but the insiders have been buying shares.
What else should you know about the energy stocks?
Tune into this week’s podcast to find out.
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