EIA Model Portfolio recommendations scored an average total return of 40.6 percent last year. High Yield Energy List picks came in at 39 percent on average. That compares to 53.6 percent for the producers-focused S&P 500 Energy Sector Index, 38.5 percent for the midstream-focused Alerian MLP Index ETF and 28.5 percent for the S&P 500 itself.
As is typical for this stage of the energy price cycle, the portfolio’s biggest winners by far were producers. Best in class independents EOG Resources (NYSE: EOG) and Pioneer Natural Resources (NYSE: PXD) returned 87.4 and 65.7 percent, respectively.
Turnaround story Occidental Petroleum (NYSE: OXY) came in with a 67.7 percent return, despite giving up much of its gains in the fourth quarter when oil prices backed off their highs. Even super major ExxonMobil (NYSE XOM) rewarded investors with 56.9 percent, as the company returned to dividend growth in defiance of its detractors in the media.
Our midstream companies started the year red hot. Most of them cooled off considerably in the second half of the year, as it became clear the volumes recovery will be coming later rather than sooner during this energy price cycle. All of them nonetheless finished the year well in the black.
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.
Elliott and Roger on Sep. 27, 2022