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High Yield Values

By Roger S. Conrad on Jan. 30, 2019

Where there’s smoke there’s fire is the old saying. And in light of the rash of dividend cuts and severe selloff of higher yielding energy companies in the second half of 2018, it’s easy to conclude as many investors have that the entire sector is finished as an income source.

The irony is, capitulation is occurring at the same time business fundamentals appear to have bottomed and sector stock valuations are again probing depths last seen in early 2016. Even weaker companies have been systematically deleveraging and reducing their operating risk, while oil prices are roughly twice their low point of $26 and change.

There are almost surely some painful adjustments ahead. And the extremely high yields of 12 percent and higher attached to more than two-dozen stocks we track are a potential red flag. That’s why any high yielding energy stock you consider now should feature the following:

Energy & Income Advisor

Your complete guide to energy investing, from growth stocks to high-yielders.

In October 2012, renowned energy expert Elliott Gue launched the Energy & Income Advisor, a twice-monthly investment advisory that's dedicated to unearthing the most profitable opportunities in the sector, from growth stocks to high-yielding utilities, royalty trusts and master limited partnerships.

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    • Elliott H. Gue

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

    • Roger S. Conrad

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