Investing

Validea's Top Five Energy Stocks Based On Peter Lynch - 4/14/2019

The following are the top rated Energy stocks according to Validea's P/E/Growth Investor model based on the published strategy of Peter Lynch. This strategy looks for stocks trading at a reasonable price relative to earnings growth that also possess strong balance sheets.

DIAMONDBACK ENERGY INC (FANG) is a large-cap value stock in the Oil & Gas Operations industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Diamondback Energy, Inc. is an independent oil and natural gas company. The Company focuses on the acquisition, development, exploration and exploitation of unconventional onshore oil and natural gas reserves in the Permian Basin in West Texas. As of December 31, 2016, the Company's total net acreage position in the Permian Basin was approximately 105,894 net acres. As of December 31, 2016, the Company, through its subsidiary, Viper Energy Partners LP (Viper), owned mineral interests underlying approximately 107,568 gross acres primarily in Midland County, Texas in the Permian Basin. The Permian Basin area covers a portion of western Texas and eastern New Mexico. The Company's reserves are located in the Permian Basin of West Texas, in particular in the Clearfork, Spraberry, Wolfcamp, Cline, Strawn and Atoka formations. The Company refers to the Clearfork, Spraberry, Wolfcamp, Strawn and Atoka formations collectively as the Wolfberry play.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E/GROWTH RATIO: PASS
SALES AND P/E RATIO: PASS
INVENTORY TO SALES: PASS
EPS GROWTH RATE: PASS
TOTAL DEBT/EQUITY RATIO: PASS
FREE CASH FLOW: NEUTRAL
NET CASH POSITION: NEUTRAL

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

HOLLYFRONTIER CORP (HFC) is a mid-cap value stock in the Oil & Gas Operations industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: HollyFrontier Corporation is an independent petroleum refiner. The Company produces various light products, such as gasoline, diesel fuel, jet fuel, specialty lubricant products, and specialty and modified asphalt. It segments include Refining and Holly Energy Partners, L.P. (HEP). The Refining segment includes the operations of the Company's El Dorado, Kansas (the El Dorado Refinery); refinery facilities located in Tulsa, Oklahoma (collectively, the Tulsa Refineries); a refinery in Artesia, New Mexico that is operated in conjunction with crude oil distillation and vacuum distillation and other facilities situated 65 miles away in Lovington, New Mexico (collectively, the Navajo Refinery); refinery located in Cheyenne, Wyoming (the Cheyenne Refinery); a refinery in Woods Cross, Utah (the Woods Cross Refinery), and HollyFrontier Asphalt Company (HFC Asphalt). The HEP segment involves all of the operations of HEP. HEP is a limited partnership, which owns and operates logistic assets.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E/GROWTH RATIO: PASS P/E/GROWTH RATIO: PASS
SALES AND P/E RATIO: PASS SALES AND P/E RATIO: PASS
INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS
EPS GROWTH RATE: PASS EPS GROWTH RATE: PASS
TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS
FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL
NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

NK LUKOIL PAO (ADR) (LUKOY) is a large-cap value stock in the Oil & Gas - Integrated industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: NK Lukoil PAO is an energy company. The primary activities of LUKOIL and its subsidiaries are oil exploration, production, refining, marketing and distribution. Its segments include Exploration and Production; Refining, Marketing and Distribution, and Corporate and other. The Exploration and Production segment includes its exploration, development and production operations related to crude oil and gas. These activities are located within Russia, with additional activities in Azerbaijan, Kazakhstan, Uzbekistan, the Middle East, Northern and Western Africa, Norway, Romania and Mexico. The Refining, Marketing and Distribution segment includes refining, petrochemical and transport operations, marketing and trading of crude oil, natural gas and refined products, generation, transportation and sales of electricity, heat and related services. The Corporate and other segment includes operations related to finance activities, production of diamonds and certain other activities.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E/GROWTH RATIO: PASS P/E/GROWTH RATIO: PASS INVENTORY TO SALES: PASS
SALES AND P/E RATIO: PASS SALES AND P/E RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS
INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS EARNINGS PER SHARE: PASS
EPS GROWTH RATE: PASS EPS GROWTH RATE: PASS TOTAL DEBT/EQUITY RATIO: PASS
TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS FREE CASH FLOW: NEUTRAL
FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL NET CASH POSITION: NEUTRAL
NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

PLAINS ALL AMERICAN PIPELINE, L.P. (PAA) is a large-cap value stock in the Oil Well Services & Equipment industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Plains All American Pipeline, L.P. owns and operates midstream energy infrastructure and provide logistics services for crude oil, natural gas liquids (NGL), natural gas and refined products. The Company operates through three segments: Transportation, Facilities, and Supply and Logistics. The Company's transportation segment operations consist of activities associated with transporting crude oil and NGL on pipelines, gathering systems, trucks and barges. Its Facilities segment operations consist of activities associated with providing storage, terminaling and throughput services for crude oil, refined products, NGL and natural gas, as well as NGL fractionation and isomerization services and natural gas and condensate processing services. Its supply and logistics segment operations consist of the merchant-related activities, including the purchase of the United States and Canadian crude oil at the wellhead, the bulk purchase of crude oil at pipeline, terminal and rail facilities.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E/GROWTH RATIO: PASS P/E/GROWTH RATIO: PASS INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS
SALES AND P/E RATIO: PASS SALES AND P/E RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS
INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS EARNINGS PER SHARE: PASS EARNINGS PER SHARE: PASS
EPS GROWTH RATE: PASS EPS GROWTH RATE: PASS TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS
TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL
FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL
NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

PHILLIPS 66 (PSX) is a large-cap value stock in the Oil & Gas Operations industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Phillips 66 is an energy manufacturing and logistics company with midstream, chemicals, refining, and marketing and specialties businesses. The Company operates through four segments: Midstream, Chemicals, Refining, and Marketing and Specialties (M&S). The Midstream segment gathers, processes, transports and markets natural gas, and transports, stores, fractionates and markets natural gas liquids (NGLs) in the United States. The Chemicals segment consists of its equity investment in Chevron Phillips Chemical Company LLC (CPChem), which manufactures and markets petrochemicals and plastics. The Refining segment buys, sells and refines crude oil and other feedstocks at refineries in the United States and Europe. The M&S segment purchases for resale and markets refined petroleum products, such as gasolines, distillates and aviation fuels, primarily in the United States and Europe, as well as includes the manufacturing and marketing of specialty products, and power generation operations.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E/GROWTH RATIO: PASS P/E/GROWTH RATIO: PASS INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS
SALES AND P/E RATIO: PASS SALES AND P/E RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: PASS
INVENTORY TO SALES: PASS INVENTORY TO SALES: PASS EARNINGS PER SHARE: PASS EARNINGS PER SHARE: PASS EARNINGS PER SHARE: PASS
EPS GROWTH RATE: PASS EPS GROWTH RATE: PASS TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS
TOTAL DEBT/EQUITY RATIO: PASS TOTAL DEBT/EQUITY RATIO: PASS FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL
FREE CASH FLOW: NEUTRAL FREE CASH FLOW: NEUTRAL NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL
NET CASH POSITION: NEUTRAL NET CASH POSITION: NEUTRAL

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

Since its inception, Validea's strategy based on Peter Lynch has returned 394.76% vs. 192.47% for the S&P 500. For more details on this strategy, click here

About Peter Lynch: Perhaps the greatest mutual fund manager of all-time, Lynch guided Fidelity Investment's Magellan Fund to a 29.2 percent average annual return from 1977 until his retirement in 1990, almost doubling the S&P 500's 15.8 percent yearly return over that time. Lynch's common sense approach and quick wit made him one of the most quoted investors on Wall Street. ("Go for a business that any idiot can run -- because sooner or later, any idiot probably is going to run it," is one of his many pearls of wisdom.) Lynch's bestseller One Up on Wall Street is something of a "stocks for the everyman/everywoman", breaking his approach down into easy-to-understand concepts.

About Validea: Validea is an investment research service that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.