optionsXpress
Dec
18
2011

Few more Energy Stocks for Long Term Investors

As promised earlier, I have prepared a list of four more energy stocks you can consider in current market scenario for 2012 and beyond. As of now we cannot call for a certain bottom in place for these counters, but their long term fundamentals remain intact. These stocks, and the ones I mentioned in my last post have been recommended by many analysts and you can easily find bullish forecasts for these stocks on various brokerage reports and financial websites. Let’s take a look at what kind of financials do these energy names hold and what to expect from them?

 

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Kinder Morgan Energy Partners (KMP)

This company has a strong presence in North America with over 37,000 miles of gas pipelines. At present they have 180 terminals and are among largest energy storage companies. Their recent $21 billion accusation of El Paso is expected to turn positive for the company as given the trend in the industry there is a good scope for distribution growth in years ahead.

 

Financials

Next reporting date January 19, 2012
EPS forecast (this quarter) $0.60
Annual revenue (last year) $8.1B
Annual profit (last year) $431.4M
Net profit margin 5.34%

Growth & Valuation

Earnings growth (last year) +18.64%
Earnings growth (this year) +22.51%
Earnings growth (next 5 years) +4.70%
Revenue growth (last year) +15.34%
P/E ratio 495.5
Price/Sales 2.67
Price/Book 3.48

 

Core Laboratories (CLB)

Now, this is the one that may excite some of you tech hunters to invest in energy space. Their business is simply creating technology for the oil and gas space, and they really have an edge to benefit from the oil boom in US. Well, their operation are not just restricted to US, their products are generating good demand in Africa and Argentina.

 

Financials

Next reporting date February 9, 2012
EPS forecast (this quarter) $1.08
Annual revenue (last year) $794.7M
Annual profit (last year) $144.9M
Net profit margin 18.24%

Growth & Valuation

Earnings growth (last year) +30.51%
Earnings growth (this year) +21.69%
Earnings growth (next 5 years) +16.00%
Revenue growth (last year) +14.25%
P/E ratio 50.6
Price/Sales 5.00
Price/Book 18.05

 

Apache (APA)

Another Houston based company; Apache is a solid independent energy company which deals in both exploration and production of natural gas, nat gas liquids and crude oil. This company has a good growth potential moving ahead and the stock prices should see some smart appreciation.

 

Financials

Next reporting date February 16, 2012
EPS forecast (this quarter) $2.78
Annual revenue (last year) $11.9B
Annual profit (last year) $3.0B
Net profit margin 25.42%

Growth & Valuation

Earnings growth (last year)
Earnings growth (this year) +31.23%
Earnings growth (next 5 years) +10.00%
Revenue growth (last year) +38.47%
P/E ratio 8.6
Price/Sales 3.52
Price/Book 1.47

 

Emerson Electric (EMR)

This company has an interesting mix of operations ranging from process management, storage business, and industrial automation to network power and climate technologies. This could be a good bet to play the economic recovery as the company has a good exposure to emerging markets. The company has over 240 manufacturing hubs worldwide and has a large employee base topping 127,700 people. Cherry on the cake, the company has a long standing history of raising dividend, and it currently remains a tad higher to 3 percent.

 

Financials

Next reporting date January 31, 2012
EPS forecast (this quarter) $0.68
Annual revenue (last year) $24.2B
Annual profit (last year) $2.5B
Net profit margin 10.14%

Growth & Valuation

Earnings growth (last year) +17.92%
Earnings growth (this year) +11.58%
Earnings growth (next 5 years) +12.00%
Revenue growth (last year) +15.05%
P/E ratio 15.2
Price/Sales 1.28
Price/Book 3.49


Conclusion

Energy remains a good theme for long term investors amid current global uncertainties as the companies are backed by strong fundamentals and their stock prices will eventually head higher when a global recovery takes place.

Now, as we are headed towards a new year its necessary that one takes a fresh look at his portfolio and weed out weaker stocks. Over the next few days, I will come up with a list of handpicked stocks from different industries, which are likely to perform better than the broader markets. So, bookmark this blog and do visit again.

Also, take a look at previously discussed energy stocks.

High Dividend Yielding Energy Sector Stocks for 2012: Top Picks with Price Targets

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2 Comments + Add Comment

  • It will be interesting to watch how the sector on the whole will deal with feared over supply of natural gas. It will test your patience before any gains can be seen

  • APA Apache is likely to be a winner among energy stocks in 2012. But investors should wait for appropriate entry points.

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