These Energy Commodities Rose This Week
With the mixed performance from energy commodities, energy stocks are down this week. As of January 17, the Energy Select Sector SPDR Fund (XLE) has fallen ~0.4% this week.
Energy & Utilities
Stock news and analysis in the energy sector, including petroleum, natural gas, and green energy,
How Does Southern Company’s Dividend Profile Look?
Georgia-based Southern Company (SO) currently offers a dividend yield of 5.2%, the highest among top SPX utilities.
OECD’s Crude Oil Inventories: Trump Card for Crude Oil Bulls?
The EIA estimates that global crude oil inventories could rise in 2018 and 2019, which is bearish for oil prices.
Iraq’s Crude Oil Production Capacity Could Hit 5 MMbpd
The EIA estimated that Iraq’s crude oil production increased by 60,000 bpd to 4,380,000 bpd in December 2017—compared to the previous month.
How USAC Deal Could Boost ETP’s Market Performance
Energy Transfer Partners (ETP) had a strong start to the year with a rise of ~6.5% in 2018 YTD (year-to-date).
MLPs Continue to Outperform Broader US Markets in 2018
MLPs maintained their winning streak in the second week of 2018. The Alerian MLP Index (^AMZ) rose 4.6% last week and ended at 300.5.
Possible Sanctions against Iran Could Impact Crude Oil Prices
Any increase in Iran’s crude oil production has a negative impact on oil prices. Lower oil (OIL) (DBO) prices are bearish for energy producers (IXC) (FXN).
WMB Has Risen ~9% in 2018 So Far: Can the Gains Continue?
Williams Companies (WMB) has had a massive start to the year. It’s risen nearly 9% in seven trading sessions in 2018. Overall, the C corporation GP (general partner) has risen ~14% since the start of December 2017.
Analysts’ Views of American Tower
As of January 2018, 21 of the 22 analysts covering American Tower stock have given it a “buy” or “strong buy” rating. The remaining analyst gave it a “hold” rating.
Does Southern Company Stock Have an Attractive Valuation?
Southern Company (SO), the second largest rate-regulated utility, is currently trading at an EV-to-EBITDA multiple of 10.5x.
How Do These MLPs Look in 2018?
MLPs had a strong start to the new year. The Alerian MLP Index rose 5% in the first week of 2018.
Will US Natural Gas Production Hit a Record in 2018 and 2019?
US dry natural gas production rose by 1.2 Bcf (billion cubic feet) per day or 1.6% to 74 Bcf per day on January 4–10, 2018, according to PointLogic.
What Has Influenced the Outlook for Valero Energy?
Valero Energy’s operating revenue fell 14% in 2016 before rising 23% in 9M17. Refining revenues drove the decline in 2016, offset by ethanol revenues.
Record Withdrawal in US Natural Gas Inventories
US natural gas inventories fell by 359 Bcf (billion cubic feet) to 2,767 Bcf between December 29, 2017, and January 5, 2018, according to the EIA.
American Tower’s Disciplined Capital Allocation
American Tower (AMT) deployed $600 million of capital in 3Q17, bringing its year-to-date amount to $3.6 billion.
US Natural Gas Consumption Could Hit a Record in 2018 and 2019
US natural gas consumption fell 14.4% to 102.6 Bcf (billion cubic feet) per day on January 4–10, 2018, according to PointLogic.
A Look at American Tower’s Well-Built Balance Sheet
During 3Q17, American Tower (AMT) strengthened its revenues on higher organic growth in domestic and international markets such as India and Mexico.
American Tower’s Strong Hold in the International Market
Mexico is one of American Tower’s (AMT) vital international markets. AMT has entered into an agreement to acquire certain telecommunication assets in Mexico.
These Factors Are Helping American Tower’s Growth
Data usage is increasing in international markets due to smartphone penetration.
American Tower Riding High with Strong Organic Growth
American Tower (AMT) has increased its 2017 revenue outlook to $6.55 billion from $6.53 billion, an addition of $15 million and a 0.2% increase.
US Gasoline Inventories: More Concerns for Oil in 2018?
US gasoline inventories rose by 4.1 MMbbls (million barrels) to 237.3 MMbbls between December 29, 2017, and January 5, 2018.
Massive Fall in Crude Oil Inventories Pushed Oil Prices Higher
US crude oil inventories fell by 4.9 MMbbls (million barrels) to 419.5 MMbbls between December 29, 2017, and January 5, 2018.
EIA Upgraded Crude Oil Price Forecasts for 2018
The EIA forecast that Brent (BNO) crude oil would average $59.74 per barrel in 2018—4.3% higher than the previous estimates in December 2017.
US Dollar Recovering from 3-Month Low: Bearish for Crude Oil?
The US Dollar Index fell ~9.8% in 2017. The dollar fell partly due to the improving economy outside the US. It was the worst annual drop since 2003.
US Gasoline Demand Is Significant for Crude Oil Bulls
According to the EIA, US gasoline demand fell by 835,000 bpd (barrels per day) or 8.8% to 8,650,000 bpd on December 22–29, 2017.
The Top 5 Upstream Companies Based on Return on Equity
The company with the highest trailing 12-month ROE (return on equity) as of 3Q17 is Carrizo Oil & Gas (CRZO) with an ROE of 52.1%.
Magellan Midstream Partners: A Brief History
Magellan’s history Magellan Midstream Partners (MMP), which began trading in 2001, has grown through various asset acquisitions and expansion projects over the years. Magellan was formerly a part of Williams Companies (WMB). The company started trading as Williams Energy Partners in 2001, and changed its name to Magellan Midstream Partners in 2003. In 2004, the […]
AMLP, AMZA, EMLP, MLPX: How Are They Different?
The Alerian MLP ETF (AMLP) invests only in infrastructure MLPs. Similarly, the Global X MLP ETF (MLPA) invests at least 80% of its assets in MLPs.
EMLP Generated the Highest Total Returns among the Top MLP ETFs
The First Trust North American Energy Infrastructure Fund (EMLP) generated total returns of 42% over a five-year period, the highest among the top five MLP ETFs that we are discussing in this series.
Crude Oil Inventories Fell, Refinery Utilization Hit 12-Year High
US crude oil futures contracts for February delivery fell 0.1% to $61.95 per barrel at 1:05 AM EST on January 5, 2018—the highest level since December 2014.
US Gasoline Inventories Could Pressure Crude Oil Prices
The EIA estimated that US gasoline inventories increased by 4.8 MMbbls (million barrels) or 2.1% to 233.1 MMbbls on December 22–29, 2017.
A Look at Breakeven Prices and Trends i n Eagle Ford Well
According to IHS, the top quintile wells are dominated by EOG Resources (EOG), Marathon Oil (MRO), and ConocoPhillips (COP).
Investment Banks’ Estimates for Crude Oil Prices in 2018
WTI crude oil (USL) prices are at their 30-month high. The US benchmark also opened above $60 per barrel in January for the first time since 2014.
What’s Driving Cheniere Energy’s Recent Rally?
Cheniere Energy (LNG) has risen 9.7% in the last six trading sessions. It rose 12.1% in December 2017 alone.
Halliburton’s 1-Week Returns on December 29
Halliburton’s (HAL) one-week stock price was 1.8% higher until December 29, 2017. Since December 22, the Energy Select Sector SPDR ETF (XLE) has risen 0.4%.
US Crude Oil Output Hit the Highest Level since May 1971
US crude output increased by 167,000 bpd to 9.64 MMbpd in October 2017—compared to the previous month. It was the highest level since May 1971.
How US Utility Stocks Are Valued for the New Year
US utilities have corrected notably over the past few weeks, and their recent valuations could start attracting new entrants.
Weatherford International’s Valuation Compared to Its Peers
Weatherford International’s (WFT) EV (enterprise value) when scaled by a trailing 12-month adjusted EBITDA is close to the peer average in our group.
Will US Natural Gas Futures Start 2018 on a Positive Note?
February US natural gas (UNG) futures contracts were above their 20-day moving averages on December 29, 2017.
US Crude Oil Rigs Could Impact Crude Oil Prices in 2018
Baker Hughes released its US crude oil rig count report on December 29. It reported that US crude oil rigs were flat at 747 on December 22–29, 2017.
Natural Gas Inventories Could Help US Natural Gas Prices
A larger-than-expected withdrawal in US natural gas inventories compared to historical averages would help natural gas prices this week.
Weekly US Crude Oil Production Fell for the 1st Time since October
US crude oil production declined by 35,000 bpd (barrels per day) or 0.4% to 9,754,000 bpd from December 15 to 22, 2017, per the EIA.
US Crude Oil Inventories Have Fallen ~10.6% in 2017
February WTI crude oil futures (DWT)(SCO) contracts rose 0.8% to $60.3 per barrel at 12:45 AM EST on December 29, 2017—the highest level since June 2015.
Analyzing Top Utilities’ Current Valuations
The steep fall in utilities in the last couple of weeks seems to have aggravated utilities due to their record high valuations.
What’s BP’s Valuation?
BP (BP) is now trading at a forward PE (price-to-earnings ratio) of 16.6x, above its peer average of 16.5x.
Coal Production Continues to Fall
On December 21, the EIA released the estimate of the coal volumes produced in the US for the week ending December 16.
Natural Gas Prices Continue to Fall
In the EIA’s STEO report, it predicted that the Henry Hub natural gas benchmark price would average $3.12 per MMBtu in 2018.
Cushing Inventories Rose for the First Time in Nearly 2 Months
Cushing inventories rose by 754,000 barrels or 1.4% to 52.9 MMbbls (million barrels) on December 8–15, 2017, according to the EIA.
Why the Oil Rig Count Could Be a Concern for Natural Gas Bulls
In the week ended December 22, the natural gas rig count was 88.5% below its record high of 1,606 in 2008.
Which Energy Stocks Were Top Losers Last Week?
In the seven calendar days to December 22, 2017, oilfield services company Seadrill (SDRL) was the largest loser.