Now that 2018 has begun, many investors have been contemplating how they want to be invested for this year and beyond. Despite 2017’s gains of 25% in the Dow and almost 19.5% in the S&P 500, the raging bull market continued its strong bullish trends into the new year by closing higher almost every single trading day so far. The reality is that this bull market is now nearing nine years old. Investors simply have no choice now to think about where they have and have not made money. Some companies and sectors have managed to perform quite poorly while the Dow and S&P 500 have both generated 300% returns since the panic selling lows of 2009.
It seems logical and safe to demand that for the bull market to keep rising some of the bull market’s lagging sectors will have to finally get on the winning side of the ledger. After all, you can’t just demand that the tech giants, financials and industrials rise indefinitely to carry this bull market endlessly higher. This is where the energy sector comes into play, oil and gas in particular.
Some of the energy stocks actually have started to see some rekindled interest, and their stocks started performing well in late 2017 and into the start of 2018. The problem with oil and gas companies of all sizes is that they have literally served up an empty plate for years. Many of their stocks are still down 25%, 50% and some even worse from just five years ago. The oil price dropping from $100 then to $80, and then toward $30, took a serious toll on energy investors and workers in the field. But now oil is back above $60. In fact, benchmark West Texas Intermediate crude is now above $64 a barrel and with Brent Sea crude is challenging $70 again. This is the highest that oil has been in years.
Many of the nimble oil and gas companies can lock in these higher prices for quite some time if they hedge properly, even if oil backs off later this year. And their costs of production in most cases are now far lower than just a few years ago, before oil’s recession hit the energy sector so hard.
24/7 Wall St. has tracked 14 major energy analyst calls in the major oil and gas stocks made so far in 2018 that should be given a second look. One alternative energy player was given a big call too, and its stock hit a six-year high. That makes for 15 energy stocks that could be worth considering for investors wanting some value, growth and perhaps a catch-up phase by one the bull market’s most disappointing sectors in the past five years. It’s time for the energy sector to do its part in the bull market in 2018.
Many investors are now thinking that there is deep value within the energy sector since the key names have lagged for so long. Until very recently, there has been little to no serious earnings support for oil or gas stocks. A higher base in oil prices, continued exports of natural gas in the years ahead, lower operating and drilling costs and seriously lower regulatory climate could all add up to a major victory for oil and gas stocks. And tax reform could help out as well. It also turns out that short sellers have even been backing away from their prior big bets against oil and gas stocks.
24/7 Wall St. covered the actual calls and added some color on each, along with trading reactions and how each of these stocks have performed. Consensus analyst target prices and other consensus data have been provided by Thomson Reuters. Here are 15 energy stocks that have received key analyst upgrades or big price target hikes calling for upside in the energy sector.
Baker Hughes, a GE Company (NYSE: BHGE) has been held back because it is under General Electric. Still, investors are starting to finally see some positive comments. Baker Hughes shares closed at $37.20 on Friday, up from $34.44 a week earlier and from $31.64 at the end of 2017. That’s a gain of better than 17% so far in 2018.