With oil trading back under $100 a barrel and to the lowest levels in three months, many across Wall Street are starting to walk away from the energy trade. It and health care been the only big winners this year. Those who walk away now may do so at their own peril, as the supply and demand balance is extremely delicate now. Any major disruption could make the black gold skyrocket.
J.P. Morgan’s Equity Strategist Marko Kolanovic, who was ranked as the number one equity-linked strategist in last year’s Institutional Investor survey, is very positive on energy and commodities as a whole. He sees the recent pullback as an opportunity for investors to add or initiate positions. He also sees the possibility for Brent crude to go to $190 a barrel, even to skyrocket to $380 a barrel if there was a cut of 5 million barrels per day.
We screened our 24/7 Wall St. energy research database looking for the highest yielding stocks in the energy and energy master limited partnership (MLP) universe. These seven are all rated Buy and come with among the highest dividends in the sector.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Antero Midstream
With shares trading under $10 apiece, this very well-run company offers a huge total return package. Antero Midstream Corp. (NYSE: AM) owns, operates and develops midstream energy infrastructure. It operates through two segments.
The Gathering and Processing segment includes a network of gathering pipelines and compressor stations that collects and processes production from Antero Resources’ wells in West Virginia and Ohio.
The Water Handling segment delivers fresh water and offers other fluid handling services, such as wastewater transportation, disposal and treatment, as well as high-rate transfer services.
Antero Midstream stock investors receive a 9.97% distribution. Wells Fargo recently lifted its $12 target price to $13. The consensus target is $10.71, and shares closed Tuesday at $9.03 apiece.
BP
This is one of the premier European integrated oil giants and top Wall Street analysts are very positive on the shares. BP PLC (NYSE: BP) engages in the energy business worldwide. It produces and trades in natural gas; offers biofuels; operates onshore and offshore wind power and solar power generating facilities; and provides de-carbonization solutions and services, such as hydrogen and carbon capture, usage and storage.
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