Still in Shipshape?
The two tanker stocks in our model Portfolios have underperformed significantly of late; we examine the potential risks and rewards associated with each of these names.
Talking Tankers
The supply-demand balance for oil tankers will weaken over the next two years, with capacity additions outstripping demand growth related to emerging trade routes, global production trends and increasing oil consumption. Nevertheless, many tanker stocks trade at valuations last seen when the market faced much bigger challenges. Meanwhile, the outlook for refined-product tankers looks better, with a smaller order book and Saudi Arabia’s growing focus on exported value-added products instead of crude oil expected to keep the supply-demand balance relatively tight.
How Our Riskier Fare Fared
Fourth-quarter results from these riskier master limited partnerships answered some question, but a great deal of uncertainty remains.
The Conservative Party: A Show of Strength from Lower-Risk MLPs
Our favorite conservative MLPs posted fourth-quarter results that demonstrate their staying power and growth prospects.
Gas-Weighted Midstream MLPs: Duds and Studs
Depending on weather patterns, US natural-gas prices could come under significant pressure in 2016. However, some of our favorite MLPs stand to benefit from low-cost basins winning market share and increasing visibility on long-term demand growth.
Oil Prices, Production Volumes and MLP Investment Strategy
The most recent issue of Energy & Income Advisor, Dusting off the Crystal Ball, laid out our outlook for the stock market, the US economy and the prices of oil, natural gas and natural gas liquids (NGL) over the coming year. These views shape our strategy for investing in master limited partnerships (MLP) in the near term and for the long haul.
Outlook 2016: Energy Prices
Our calls on crude-oil prices over the past year have been spot on for the most part. Although our macro calls haven’t saved our Portfolios from the carnage, we have avoided many of the worst performers, used hedges to provide some upside protection and set ourselves up to profit from the down-cycle’s final chapters. Here’s what we see for the year ahead.
Strategy Update
Although many of our decisions in 2015 necessarily reflected our outlook for significant downside in crude-oil prices during the fall and winter turnaround seasons, investors should take a longer view when positioning their portfolios this year.
Outlook 2016: US Economy and Stock Market
Wall Street analysts’ consensus estimate for US economic growth appears overly optimistic, while technical indicators suggest that the risk of a bear-market correction in the S&P 500 remains elevated.
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Live Chat with
Elliott and Roger on Jul. 27, 2017
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
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Roger S. Conrad
Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor
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Elliott H. Gue
Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor
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Peter Staas
Managing Editor: Capitalist Times and Energy & Income Advisor