Is it time to buy energy?

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Old 02-03-2015, 12:30 PM
shcisamax shcisamax is offline
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Default Is it time to buy energy?

Energy stocks and funds are hammered. Looks like they are starting to find balance. Any thoughts on whether it is a false start? I would imagine they are low enough that, if in for a good five years, you will be a happy camper.
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Old 02-03-2015, 05:57 PM
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villagetinker villagetinker is offline
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The energy company I worked for, PPL (over 40 years), is just getting ready to sell of all of their power plants, becoming strictly a Transmission and Distribution company. During this process I will have me existing PPL stock price reduced, and the equivalent Talon stock to replace the reduced PPL stock.
Now to your question, my initial reaction was to tell my investment advisor to get rid of the Talon ASAP, as these plants have been losing money for the last 2 years. The extended low oil and gas prices will continue to put significant pressure on energy companies, some will profit, some will suffer significant losses. You will need to look very carefully at the basis of the energy stocks, to see the short term (low oil and gas prices), and the long term (eventual rising of oil and gas prices) effects on the expected price of these stocks.
As for me I am still one the fence, I need to look at tax consequences, short and long term outlook for Talon Energy, etc.
Hope this helps, if not it will probably start an interesting discussion.
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Old 02-04-2015, 06:55 AM
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Biker Dog Biker Dog is offline
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Vanguard Energy Index Fund ETF>>>>#112.99
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Old 02-04-2015, 07:38 AM
Laurie2 Laurie2 is offline
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Quote:
Originally Posted by shcisamax View Post
Energy stocks and funds are hammered. Looks like they are starting to find balance. Any thoughts on whether it is a false start? I would imagine they are low enough that, if in for a good five years, you will be a happy camper.
I have wondered if there are some oil stocks that are trying to bounce off bottom. Who knows.

But those interested in oil might want to have a look at payout ratios and dividend history (including increases in dividends) for stocks such as XOM and CVX. I think XOM and CVX are considered Dividend Aristocrats.

Dividend investors want to get paid to wait so they look for stocks that might seem boring but that keep putting that check in the mail -- quarter after quarter, year after year, decade after decade. If they catch such stocks at a relative low, there can be the possibility of taking a nice gain later, after waiting around, cashing checks for a while.

Traders and investors have very different philosophies sometimes. It might be time for both to have a look.
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Old 02-04-2015, 08:50 AM
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manaboutown manaboutown is offline
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Back in 2009 when the self storage REITs got hammered due to serious problems in the financial industry I scooped some up at ridiculously low prices based on cost pre square foot. At the time I did not have the guts to buy more. Wish I had now, of course. Similarly, I thinks the plunge in oil prices offers some remarkable possibilities based on assets versus price of the stock as well as very treacherous situations. Research, research, research and only buy as much upon which you can afford to absorb the downside. Remember, Price is what you pay. Value is what you get, attributed to Mr. W. Buffett.
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