The fourth-quarter earnings season is about to get underway, so very soon the real winners and losers will be revealed. Personally, I expect stocks with the strongest sales and earnings momentum to emerge as market leaders. And one bucket of stocks that should come out on top is energy.
The energy sector is forecast to report more than 90% annual earnings growth for the fourth quarter. That’s stunning, especially when you consider that the S&P 500 is only expected to post fourth-quarter earnings growth of 17.4%, down from the 28.2% annual earnings growth reported in the third quarter.
Natural gas prices have soared given the very cold start to winter in the Midwest, Northeast and even the South. Crude oil prices, though, plunged in December on speculation that President Trump has convinced Saudi Arabia to maintain its production of crude oil.
Now, this oil glut is expected to continue this year, but reports from the Wall Street Journal that shale oil wells are pumping less crude oil than forecasts has helped oil prices firm up recently. Seasonal demand is also expected to rise in the spring, which should help recent volatility in the energy patch to subside further.
To make sure you’re in the best-positioned energy stocks for the New Year, here are nine energy companies to consider.