Energy

Energy Short Interest Highest Ever: Stick With 3 Large Cap Dividend Leaders in 2016

Lee Jackson

Published: December 29, 2015 8:35 am

Last Updated: January 13, 2020 3:38 pm

Even after a brutal 2015 that saw the energy sector just get absolutely hammered, the vultures continue to circle the flock looking for the weaklings that may be forced out of business as 2016 hedges come off. SunTrust Robinson Humphrey notes that the short interest group average is now the highest on record at 16%. While oil prices are expected to be higher by this time next year, the short term could remain rocky.

We screened our institutional research database and found three companies rated Buy that should be able to maintain their high dividends and fight through to the end of the downturn.

Chevron

This stock is very solid story for investors looking to stay long the energy sector. Chevron Corp. (NYSE: CVX) is a U.S.-based integrated oil and gas company with worldwide operations in exploration and production, refining and marketing, transportation and petrochemicals. The company sports a sizable dividend, and has a solid place in the sector when it comes to natural gas and liquefied natural gas (LNG). Some Wall Street analysts estimate the company will have a compound annual growth rate of over 5% for the next five years, and the stock trades at a modest valuation discount to some of its mega-cap peers.

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