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Feature Article

Focus List (Mostly) Outperforms and Portfolio Updates

The improved outlook for oil prices and the rotation into energy stocks has lifted most boats in the sector, though we’re pleased that nine of the 13 names on our Focus List have outperformed the S&P 500 Energy Index over an equivalent holding period. We review our Focus List and discuss earnings and other pertinent developments affecting our Portfolio holdings.

Profiting from Key Energy Trends in Canada, Australia and Mexico

We’re less than three weeks into 2018, but several notable trends have emerged affecting the names in our International Portfolio, which primarily comprises positions in Canadian and Australian energy companies. These developments bear watching and will create challenges and opportunities over the next 12 to 18 months.

MLPs: Review and Outlook

We explain why we remain selectively bullish on master limited partnerships in 2018, discuss key opportunities and areas of risk, analyze trends in mergers and acquisitions, and highlight our favorite picks for the coming year.

Positioning the Portfolios for 2018

Many investors’ tax rates will come down in 2018, making the next few trading days your best opportunity for taking tax losses on any underwater positions that may take time to recover. With investors facing higher tax liabilities in 2017 than next year, the benefit of writing off a loser is that much greater.

Of course, we prefer to avoid taking any losses and run the Energy & Income Advisor Portfolios with an eye toward long-run returns. However, given the sector’s recent down-cycle and the topsy-turvy performance of many energy sub-industries over the past few years, we have a few positions that haven’t worked out because of timing issues or a faulty investment thesis. These sales will help to offset the handful of gains that we took over the course of the year.

Surveying the Oil-Field Services Landscape

The tale of two cycles looks set to continue for another year. Drilling activity may have bottomed in the international markets, but pricing pressure will persist until price deflation improves break-evens and upstream operators have more confidence in the outlook for oil prices. Meanwhile, some US exploration and production companies may moderate their spending increases relative to last year, but this short-cycle market remains the best bet for incremental growth and pricing gains in 2018–especially if our call for oil prices to average between $55 and $60 per barrel pans out. Given our preference for US exposure at this point in the cycle, we review the challenges, opportunities and market dynamics in three prominent onshore service lines through the lens of companies’ third-quarter results: contract drilling, pressure pumping and proppant.

Lessons from Canada for US Midstream Master Limited Partnerships

Does Canada’s midstream segment provide a model for the evolution of US master limited partnerships? We explore what factors have helped Canadian pipeline stocks outperform despite currency headwinds and lower realizations on oil and gas prices.

Paradigm Shift in MLP Land

Big changes are afoot in the midstream segment. Many master limited partnerships appear to have taken Enterprise Products Partners LP’s lead and shifted their focus to building distribution coverage and reducing equity. We explore which names will be able to make this transition with relative ease and which names face more of a slog to put themselves on a path to sustainability.

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  • Live Chat with

    Elliott and Roger on Mar. 20, 2018

  • Portfolios & Ratings

    • Model Portfolios

      Balanced portfolios of energy stocks for aggressive and conservative investors.

    • Coverage Universe

      Our take on more than 50 energy-related equities, from upstream to downstream and everything in between.

    • MLP Ratings

      Our assessment of every energy-related master limited partnership.

    • International Coverage Universe

      Roger Conrad’s coverage of more than 70 dividend-paying energy names.

    Experts

    • Roger S. Conrad

      Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor

    • Elliott H. Gue

      Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor

    • Peter Staas

      Managing Editor: Capitalist Times and Energy & Income Advisor