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TOP INFLATION STOCKS EXPLODING: Get RICH From Russia Energy Sanctions! HUGE 14% Dividend.
We’ve all have heard of the sanctions the US has instituted against Russia since the invasion of Ukraine began. Today we are looking at two, under the radar, energy stocks to watch that could be particularly well-positioned to explode. Especially since these oil stocks are also at the beginning of the production chain, so can benefit by raising prices as inflation creeps higher in 2022.
In looking at the sector tracker, sectorspdr.com, here spyder is spelled spdr, we can see that Energy is up 9.15% over the past month! Leading stocks include: Occidental Petroleum, Baker Hughes, Chevron and Halliburton. Companies that also have an ability to refine their oil will have an advantage here.
To find some of the top buys in lower priced oil stocks with attractive price-to-sales ratios. I did a search on Finviz, see my link in the description below. This search included seeking stocks with a price to earnings ratio under 15, a decent return on equity, and Low debt to equity ratios. Especially as the cost of borrowed money will be steadily increasing with rising interest rates.
In looking at the earnings growth that the S&P 500 are projecting for the entire 2022-year, Energy is in the lead. FYI, Factset aggregates all the company and analysts’ projections into forecasts you see here. In looking at history, the Energy sector has averaged a 7 PE ratio over the last 5 years (probably because energy use declined in 2020) and Energy had a 10-year average PE of 15.8. So, I conducted a search seeking stocks with a PE below this 10-year average.
Hi investing friends, this is Lynn, and welcome back! So. Let’s go and review today’s hot stocks! But first, if you could give it a thumbs-up in return for my efforts analyzing these stocks, it would be greatly appreciated. And, while you’re at it subscribe, and remember, this is not financial advice, and for entertainment only.
The first stock we are discussing today is TransGlobal Energy Corporation, ticker TGA with a price per share of $3.42. They have a low PE ratio of only 8.12 and market cap of 248 million.
TransGlobe Energy Corporation, together with its subsidiaries, engages in the acquisition, exploration, development, and production of crude oil and natural gas in Egypt and Canada. The company holds interests in four production sharing concessions in Egypt and facilities in west central Alberta, Canada. TGA is an established company and was incorporated in 1968 with headquarters in Calgary.
TransGlobe is committed to promoting oilfield development and exploitation best practices including a commitment to HSES and the implementation of industry leading secondary and tertiary recovery methods as well as improvements to production and transportation infrastructure.
TransGlobe’s goal is to become a leading independent international energy producer, with a focus on the Middle East/North Africa region.
In looking at their quarterly financials, note that all numbers are listed in thousands. TGA has growing Free Cash flows. This is an important measurement, and is the money a company has left over after paying its operating expenses and capital expenditures.
The next oil and refinery stock we are reviewing today is Petróleo Brasileiro S.A. – Petrobras, Ticker PBR. This stock is listed for $13.40 per share. I was so impressed by what I learned about this stock, along with its huge dividend yield, that I did purchase shares of this stock while conducting this analysis.
Before we get into the details, I wanted to let you know that I just completed my first skillshare class. If you’re considering making a video for YouTube, using the Free version of Davinci resolve as an editor, this will be the class for you. My link in the description below will give you a free month to try out an unlimited amount of skillshare classes!
PBR has a low price to earnings ratio of only 4.42, and Yahoo finance lists this stock as undervalued. What’s really exciting is that at the present PBR is paying a dividend yield of 14.85%. But you should be aware that this dividend yield has fluctuated wildly in the past. This payout history from Dividend.com shows a yield on cost of 1.37% in December of 2020 to 7.33% in December of 2021.
PBR is a sizable company with a market cap of 88 billion and an average daily trading volume of 34 million shares per day. You can see by the green one-year chart on this Yahoo Finance profile that the stock has increased in price over the past year, with regular pullbacks to be expected.
Petrobras produce and sells oil and gas in Brazil and internationally. It engages in prospecting, drilling, refining, processing, trading, and transporting crude oil from onshore and offshore oil fields, and shale, natural gas, and other liquid hydrocarbons. The company has a number of business units including: Exploration and Production; Refining, Transportation and Marketing; along with Gas and Power. Petrobras is another established company that was founded in 1953 and is headquartered in Rio de Janeiro, Brazil.
In keeping with my earlier comment that these oil companies, due to Russia restrictions and inflation, as primary producers will have the ability to raise prices as they see fit. This Reuters article states that – Petrobras announced in March that it will raise diesel prices by around 25% at its refineries, while gasoline prices are expected to rise nearly 19%. All these price increases were stated to be in the wake of gains in oil prices on the international market due to the war in Ukraine. Currently, these price moves appear to bode well for a potential rise in profitability for PBR.
Currently PBR is also sporting some impressive financials. Finviz lists the with a profit margin of 23.60%. It’s also great to see that insiders own close to 40% of this stock, and institutions own 22%. Plus, the stock’s performance year to date is up 29%.
PBR also produces an excellent level of Free cash flow which increased 33% in 2021 versus 2020.
This slide from a recent PBR presentation outlines the continuing efforts in reducing the company’s debt. Something to watch out for though are the levels of resistance in this stock.
This 5-year stock chart for PBR reveals resistance levels at the red line, it needs to get past the $15.44 and $16.83 price levels, which could cause more volatility in the short term.
You know I always love hearing from you, so please let me know what your thoughts are, in the comments below, about TGA and PBR, or any other stock that you are liking right now. Remember also to sign up through the link in the description below for our newsletter, so that you can receive more updates on stock market trends, like this one. Also, go here next for a video picked out specifically for you!