In this piece, we will take a look at the 15 best energy stocks to buy now. If you want to skip our overview of the global energy industry and some latest events, then you can take a look at the 5 Best Energy Stocks To Buy Now.
In recent memory, 2022 emerged as a pivotal year for the global energy sector, following a tumultuous period where energy stocks plummeted due to weakened global demand amid the COVID-19 pandemic. The onset of the Russian invasion of Ukraine disrupted the industry further, prompting European nations to seek alternative fuel sources. Consequently, major players like Exxon Mobil Corporation (NYSE:XOM), Occidental Petroleum Corporation (NYSE:OXY), and Shell Plc (NYSE:SHEL) reported unprecedented revenues, leading to substantial jumps in their stock prices in the initial stages of the conflict.
Additionally, fossil fuels have shown their impact on the economy as well in recent years. While investments in renewable energy have surged ahead of traditional energy investments, the volatility and uncertainty caused by fossil fuels have roiled markets. Nonetheless, the International Energy Agency (IEA) projects a significant decline in fossil fuel demand, with a projected 25% reduction by 2030 and an 80% decrease by 2050. According to a report by the Institute of Energy Economics and Financial Analysis, the decline of the oil and gas sector has been gradual. It highlights that in 1980, the sector represented approximately 29% of the S&P 500, a figure that has since dwindled to a mere 5.3%.
According to the IEA's inaugural energy outlook report released in January 2024, the agency identifies the escalation of the crisis in the Middle East as a major risk to the global oil sector. What began as a significant attack by Hamas on Israel has evolved into a broader, low-intensity conflict involving the Houthi rebel group targeting global shipping routes. Contrarily, the Organization of Petroleum Exporting Countries (OPEC) issued a report aimed at both maintaining optimism and stabilizing oil prices. This optimism was underscored by the organization's projection that non-OPEC liquids production would increase within the current year, marking a departure from the norm. Additionally, OPEC made a rare move by unveiling a 12-month+ forecast for the oil industry, offering insights into the industry's trajectory up to 2025. Forecasts indicate a robust growth in global oil demand of 1.8 million barrels per day by 2025, largely driven by economic resurgence in China.
With these details in mind, let's take a look at some of the best energy stocks to buy now, with notable names including the likes of Occidental Petroleum Corporation (NYSE:OXY), Exxon Mobil Corporation (NYSE:XOM), and Chevron Corporation (NYSE:CVX).
15 Best Energy Stocks To Buy Now
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Our Methodology
In compiling our roster of the best energy stocks to buy, we made use of a stock screener to rank the top energy stocks listed on both the NYSE and NASDAQ based on their market capitalization. In addition, we made use of hedge fund sentiment to list down 15 of the best among these companies. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.
EOG Resources, Inc. (NYSE:EOG) is an American energy enterprise specializing in hydrocarbon exploration. Registered in Delaware and headquartered in Houston, Texas, it operates from the Heritage Plaza building. In its recent earnings report, EOG Resources, Inc. (NYSE:EOG) revealed a 3% increase in total equivalent production for the fourth quarter of 2023 compared to the previous quarter. The company exceeded its guidance midpoint with oil production reaching 485,200 barrels per day (bopd), showing growth from the prior quarter. Throughout 2023, the company reported an 8% increase in total equivalent production compared to 2022, with crude oil production experiencing a 3% rise to 475,800 bopd, NGL production surging by 13%, and natural gas production seeing a 14% increase.
After digging through 933 hedge fund portfolios for Q4 2023, Insider Monkey discovered 42 EOG Resources, Inc. (NYSE:EOG) shareholders. Natixis Global Asset Management’s Harris Associates was the firm’s biggest investor in our database as it owned 7.28 million shares that are worth $881 million.
Along with Occidental Petroleum Corporation (NYSE:OXY), Exxon Mobil Corporation (NYSE:XOM), and Chevron Corporation (NYSE:CVX), EOG Resources, Inc. (NYSE:EOG) is one of the best energy stocks to buy.
Shell plc (NYSE:SHEL) stands as a global powerhouse in the energy and petrochemical sectors, operating across various segments including Integrated Gas, Upstream, Marketing, Chemicals and Products, and Renewables and Energy Solutions. The company's operations encompass the exploration and extraction of crude oil, natural gas, and natural gas liquids, alongside marketing, transportation, and trading of these vital resources. Recognized as one of the premier energy stocks for investment, Shell plc (NYSE:SHEL) continues to be a frontrunner in the industry.
On February 1, Shell plc (NYSE:SHEL) announced a quarterly dividend of $0.688 per share, marking a 3.9% increase from its previous dividend of $0.662. This dividend was scheduled to be paid on March 25 to shareholders of record as of February 16. Additionally, the company's board had approved a share repurchase plan amounting to $3.5 billion, slated to be completed before the company's Q1 2024 financial results are released.
By the end of 2023’s December quarter, 46 out of the 933 hedge funds covered by Insider Monkey’s research had held a stake in Shell plc (NYSE:SHEL). Ken Fisher’s Fisher Asset Management was the firm’s biggest stakeholder among these due to its $1.5 billion stake.
Headquartered in Houston and incorporated under the Delaware General Corporation Law, Baker Hughes Company (NASDAQ:BKR) stands as a prominent global leader in oil field and gas services. Renowned for its comprehensive suite of offerings, the company provides a wide range of services encompassing oil well drilling, formation assessment, completion, production, and reservoir advisory services.
On February 22, Baker Hughes Company (NASDAQ:BKR) announced the acquisition of a contract with Petrobras, Brazil's state-owned oil and gas giant, for integrated well construction services in a significant deepwater field situated in Brazil's pre-salt Santos Basin. Set to commence in the first half of 2025, the integrated services project will encompass drilling services, drill bits, wireline, cementing, wellbore clean-up, fishing, remedial tools, fluids, services, and geosciences for the Buzios field.
As of the end of Q4 2023, 47 hedge funds demonstrated keen interest in Baker Hughes Company (NASDAQ:BKR), revealing disclosed positions valued at $911.8 million
ClearBridge Select Strategy made the following comment about Baker Hughes Company (NASDAQ:BKR) in its Q3 2023 investor letter:
“Performance was boosted in the quarter by the Strategy’s more economically-sensitive holdings among steady compounders and evolving opportunities. Oilfield equipment and services provider Baker Hughes Company (NASDAQ:BKR), meanwhile, benefited from a $20 rise in crude oil prices as well as disciplined execution.”
Headquartered in San Antonio, Texas, Valero Energy Corporation (NYSE:VLO) is an American-based downstream petroleum company primarily engaged in the manufacturing and marketing of transportation fuels, alongside other petrochemical products and power.
On March 26, UBS raised its price target for Valero Energy Corporation (NYSE:VLO) shares to $197 from the previous $167, while maintaining a Buy rating for the stock. The firm's evaluation reflects VLO's robust performance since March 2020, with a 259% increase compared to the S&P Energy sector's 221% rise and the S&P 500's 99% gain.
47 out of the 933 hedge funds part of Insider Monkey’s Q4 2023 database had invested in the firm. Valero Energy Corporation (NYSE:VLO)’s largest stakeholder among these is Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital through its $290 million stake.
Cenovus Energy Inc. (NYSE:CVE) engages in the development, production, refining, transportation, and marketing of crude oil, natural gas, and refined petroleum products in Canada and internationally. Its operations span across Oil Sands, Conventional, Offshore, Canadian Refining, and U.S. Refining segments.
On February 15, the company announced a quarterly dividend of C$0.14 per share, consistent with previous payouts. The dividend was distributed on March 28 to shareholders on record as of March 15.
Insider Monkey’s fourth-quarter database revealed that 50 hedge funds held positions in Cenovus Energy Inc. (NYSE:CVE), compared to 41 funds in the previous quarter. The largest stakeholder is Israel Englander’s Millennium Management, with holdings of 16.5 million shares valued at over $275 million.
Headquartered in Findlay, Ohio, Marathon Petroleum Corporation (NYSE:MPC) is a prominent U.S.-based company primarily focused on petroleum refining, marketing, and transportation. Originally a subsidiary of Marathon Oil until its corporate spin-off in 2011, the company has established itself as one of the world's largest pipeline operators, managing an extensive network spanning nearly 14,000 miles.
In December 2023, Morgan Stanley highlighted several stocks with noteworthy attributes such as high free cash flow, robust earnings per share growth, and an overweight rating in its U.S. Equity Strategy report. Among the selected stocks was Marathon Petroleum Corp (NYSE:MPC).
During last year’s fourth quarter, 50 out of the 933 hedge funds profiled by Insider Monkey had held a stake in the firm. Marathon Petroleum Corporation (NYSE:MPC) ‘s largest hedge fund shareholder in our database is the well known activist investor Elliot Singer’s Elliott Management due to its $1.64 billion investment.
Devon Energy Corporation (NYSE:DVN) is deeply involved in the exploration, development, and extraction of oil, natural gas, and natural gas liquids within the United States. Founded in 1971 and headquartered in Oklahoma City, Oklahoma, the company has established itself as a key player in the energy sector. Devon Energy Corporation (NYSE:DVN) is widely regarded as one of the top energy stocks for investment. As of March 28, the company offers a quarterly dividend of $0.83 per share, boasting an impressive dividend yield of 6.60%.
50 out of the 933 hedge funds tracked by Insider Monkey were the firm’s shareholders. Devon Energy Corporation (NYSE:DVN)’s largest hedge fund investor is D. E. Shaw as it holds $230 million worth of shares.
ConocoPhillips (NYSE:COP) operates globally as an energy company, focusing on the exploration, production, transportation, and marketing of various energy resources including crude oil, bitumen, natural gas, liquefied natural gas, and natural gas liquids. With its inception dating back to 1917, ConocoPhillips is headquartered in Houston, Texas, and has cemented its position as one of the best energy stocks to buy.
On February 8, ConocoPhillips (NYSE:COP) announced its Q4 non-GAAP EPS of $2.40, surpassing market estimates by $0.23. Additionally, the company declared a quarterly dividend of $0.58 per share, consistent with previous payouts. This dividend is scheduled to be paid on March 1 to shareholders of record as of February 19.
59 out of the 933 hedge funds part of Insider Monkey’s Q4 2023 database had held a stake in ConocoPhillips (NYSE:COP).
Schlumberger Limited (NYSE:SLB) serves as a leading global energy technology provider, with operations spanning across the globe. The company is structured into four main divisions: Digital & Integration, Reservoir Performance, Well Construction, and Production Systems.
In January of this year, Schlumberger Limited (NYSE:SLB) released its fourth-quarter results. The adjusted earnings per share for the period stood at $0.86, surpassing estimates by $0.03. Additionally, the company reported a notable 13.8% year-over-year increase in revenue for the quarter, totaling $8.99 billion, which exceeded estimates by $50 million.
During Q4 2023, 62 out of the 933 hedge funds profiled by Insider Monkey had bought Schlumberger Limited (NYSE:SLB)’s shares. Rajiv Jain’s GQG Partners was the biggest shareholder due to its $1.5 billion investment.
Alger Spectra Fund made the following comment about Schlumberger Limited (NYSE:SLB) in its Q3 2023 investor letter:
“Schlumberger Limited (NYSE:SLB) provides technology for reservoir characterization, drilling, production, and processing to the oil and gas industry. During the period, shares contributed to performance driven in large part by higher oil prices and strong fiscal second quarter earnings results. Within its quarterly report. the company highlighted growing momentum in international offshore markets that reflected market share gains as well as solid end market activity, leading to strong profit margins and healthy free cash flow generation, in our view.”
Based in Houston, Texas, Cheniere Energy, Inc. (NYSE:LNG) is deeply involved in the liquefied natural gas (LNG) sector, overseeing operations at the Sabine Pass LNG terminal in Louisiana. On November 8 2023, Cheniere Energy, Inc. (NYSE:LNG) disclosed its anticipation for the first LNG cargo from its Corpus Christi Liquefaction Stage 3 (CCL Stage 3) brownfield expansion project to depart by the conclusion of 2024, surpassing the originally projected timeline.
As of December 2023 end, 64 out of the 933 hedge funds profiled had held a stake in Cheniere Energy, Inc. (NYSE:LNG). Israel Englander’s Millennium Management owned the largest stake which was worth $399.16 million.
Cheniere Energy, Inc. (NYSE:LNG), Occidental Petroleum Corporation (NYSE:OXY), Exxon Mobil Corporation (NYSE:XOM), and Chevron Corporation (NYSE:CVX) are some of the best energy stock to invest in.
