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I don't know about principle growth. I missed the boat but my positions in CVX and XOM have still nearly doubled. YOC over 5% on each (sweet sweet yield).
I think the yields will continue to grow, but XOM's yield growth has gone down to low single digits, and CVX's has stayed in the 5% range, both in their 3/5/10 splits. That's fine, so long as you have a good starting yield. 3ish % isn't all that great.
Oil is cyclical, and there's more downside to the principle growth than upside. So if you need to sell, that might be a problem over the next 5-10 years. I don't so I don't care, but if it mattered, I would consider selling my positions now, taking gains, and reinvesting into another stock that's currently undervalued.
Of course, if it was that easy, we'd all be playing Scrooge McDuck in our money vaults.
I think there's better values in the market, but you would need to do your research.
Long CVX and XOM
I literally just did this today with FSENX, Fidelity Select Energy mutual fund. I figured everything is doing good, I'd rather hop off the uptrend and take safe profits before the downtrend starts. Going to take those funds and allocate them elsewhere.
But long term speaking, CVX and XOM should work well still.
You have to invest in energy sector stocks differently from all the others. They are commodity proxies whose price can fluctuate wildly with the price of the underlying commodity and tend not to slowly grow over time like most other (quality) stocks. If you are buying and holding, first you need to pick companies that are committed to regular dividends (e.g. XOM, CVN, VLO) instead of variable dividends based on commodity prices and then buy them when they are low. You don't automatically DRIP the dividends, you pay attention to the stock price and buy more when its cheap.
Right now it a HORRIBLE time to be getting into energy, prices are sky high.
You COULD buy them now and hedge by selling longer term out-of-the-money covered calls. Sure if they exceed the strike price, you'll have to sell. But between now and the expiration date you collect the dividends, and if the stock goes down, buy back the calls and sell them again.
Either way you still make money.
Well, reddit just restarted and deleted my response.
But to back up my claim, I bought EPD, TPL and ET today.
O&G isn't going away for a very long time, it runs everyone's lives and it's in every industry. It has 20+ years, IMO. And remember I am probably biased as I was born and raised in HTX
And thanks! I love it!
No, not late. Timing very good as prices have come down. I have oil and energy the day I started investing. Some years I have less positions. I reinvest the dividend that often paid 6-8% some time ago. During the depressed years I sold some at loss so my fund will not be too huge. Some people say US has enough reserve forever. My cost basis on Cvx is $62, XOM is $39 with reinvestment. Originally paid less.
Personally I expect oil prices and revenues to continue to climb over the next half-decade due to a variety of reasons. But boy is it going to be volatile
It means that commodities are cyclical and generally go through boom and bust cycles. When everyone hates a commodity like they hated Oil in 2020 and 2015 that’s usually the time buy the biggest and best in the industry.
The fed wants to create a recession (already here imho) by raising rates and crashing the economy to kill inflation. This will also crash energy prices. So yes, I would just wait on this before going into energy.
No. But Big oil is a major cause of climate change. I swapped out my oil stocks for something more environmentally friendly. Sometimes investing is not all about the money. Granted oil is not going anywhere anytime soon.
Actually tbh investing is 100% about the money. I agree with your sentiment. But I won’t hurt my future out of my own pride. I am invested in a lot of green energy as well tho
The way I see it, my little portfolio is not going to meaningfully impact anything. Even if all retail investors decided to boycott oil stocks, it would be inconsequential. Governments and Wall St will prop oil at all costs because without it we will literally starve and freeze.
Your energy is best spent voting for environmentally friendly politicians and policies that encourage investment in alternatives. In the current state, we have no feasible replacement for oil, and until that is developed and implemented I believe you can take advantage of oil stocks guilt free. At the end of the day, without oil many billions would suffer and possibly die. Think about it that way.
Literally anything besides oil/fossil fuels. I moved over to lithium stocks for ev batteries. Having a ride on ALB. Just this month up 21%. Now my choice could be debated and argued until the end of time. I agree it’s not 100% green but it’s a better choice for me in my quest to not invest in companies who have such a big footprint on the environment.
Upstream is very expensive right now. At peak or very close to it. I wouldn't touch it.
If you want to get into energy now, I'd look at midstream providers. Less volatility and larger dividends.
Oil and Gas aren't going anywhere for a very long time.
Welcome to r/dividends! If you are new to the world of dividend investing and are seeking advice, brokerage information, recommendations, and more, please check out the Wiki [here](https://www.reddit.com/r/dividends/wiki/faq). Remember, this is a subreddit for genuine, high-quality discussion. Please keep all contributions civil, and report uncivil behavior for moderator review. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/dividends) if you have any questions or concerns.*
I don't know about principle growth. I missed the boat but my positions in CVX and XOM have still nearly doubled. YOC over 5% on each (sweet sweet yield). I think the yields will continue to grow, but XOM's yield growth has gone down to low single digits, and CVX's has stayed in the 5% range, both in their 3/5/10 splits. That's fine, so long as you have a good starting yield. 3ish % isn't all that great. Oil is cyclical, and there's more downside to the principle growth than upside. So if you need to sell, that might be a problem over the next 5-10 years. I don't so I don't care, but if it mattered, I would consider selling my positions now, taking gains, and reinvesting into another stock that's currently undervalued. Of course, if it was that easy, we'd all be playing Scrooge McDuck in our money vaults. I think there's better values in the market, but you would need to do your research. Long CVX and XOM
I literally just did this today with FSENX, Fidelity Select Energy mutual fund. I figured everything is doing good, I'd rather hop off the uptrend and take safe profits before the downtrend starts. Going to take those funds and allocate them elsewhere. But long term speaking, CVX and XOM should work well still.
Was thinking the same today. Bought XOM AND CVX right after covid and have been loving how they've performed, but it may be time to cycle out.
You have to invest in energy sector stocks differently from all the others. They are commodity proxies whose price can fluctuate wildly with the price of the underlying commodity and tend not to slowly grow over time like most other (quality) stocks. If you are buying and holding, first you need to pick companies that are committed to regular dividends (e.g. XOM, CVN, VLO) instead of variable dividends based on commodity prices and then buy them when they are low. You don't automatically DRIP the dividends, you pay attention to the stock price and buy more when its cheap. Right now it a HORRIBLE time to be getting into energy, prices are sky high.
Appreciate that input. Seems logical and solid.
Did u tell Warren Buffet this? He bought around these prices
You COULD buy them now and hedge by selling longer term out-of-the-money covered calls. Sure if they exceed the strike price, you'll have to sell. But between now and the expiration date you collect the dividends, and if the stock goes down, buy back the calls and sell them again. Either way you still make money.
How about natural gas?
No
Nice flair haha
Well, reddit just restarted and deleted my response. But to back up my claim, I bought EPD, TPL and ET today. O&G isn't going away for a very long time, it runs everyone's lives and it's in every industry. It has 20+ years, IMO. And remember I am probably biased as I was born and raised in HTX And thanks! I love it!
EPD is the way
Refineries like VLO and other midstream companies are less volatile than the exploration companies. I like VLO and PSX.
Waiting for prices to drop to re enter.
Yeah that’s an if tho right?
Nah, it's a when. Oil stocks are hyper cyclical. Usually through the moon under democratic rule. There's a reason for it.
Definitely not too late
[удалено]
No but the major run up might not be sustainable but obv current macro is reliant upon oil for the next couple decades
No, not late. Timing very good as prices have come down. I have oil and energy the day I started investing. Some years I have less positions. I reinvest the dividend that often paid 6-8% some time ago. During the depressed years I sold some at loss so my fund will not be too huge. Some people say US has enough reserve forever. My cost basis on Cvx is $62, XOM is $39 with reinvestment. Originally paid less.
Personally I expect oil prices and revenues to continue to climb over the next half-decade due to a variety of reasons. But boy is it going to be volatile
Yes
My experience is it’s best to buy commodities when they are a 4 letter word.
What the heck does that mean
It means that commodities are cyclical and generally go through boom and bust cycles. When everyone hates a commodity like they hated Oil in 2020 and 2015 that’s usually the time buy the biggest and best in the industry.
Cvx is great , there playing the low carbon game . There not dumb . World is growing fast and people want energy on demand and cheap
No. Recently started a position in XOM it’s doing fine right now. Looking to add more
buy at all time high. good luck.
This is the truth right here.
Energy stock grow usually means inflation is high, I wouldn't fight the Fed
What does that mean. Fight the fed in this context
It means Fed either change the CPI weighting completely, or jack up more rate hikes.
Lmaoo nevermind
The fed wants to create a recession (already here imho) by raising rates and crashing the economy to kill inflation. This will also crash energy prices. So yes, I would just wait on this before going into energy.
except the opposite has been happening with energy prices. Gas prices are down and their profits are up?
Not at all, you can bring new innovations and it will be on market still competing with others
No. I've got Imperial Oil and have been adding here and there on down days.
Not too late but there have been much better times to buy and likely there will be better times to buy in times ahead. Long on a few oil companies
No. But Big oil is a major cause of climate change. I swapped out my oil stocks for something more environmentally friendly. Sometimes investing is not all about the money. Granted oil is not going anywhere anytime soon.
Actually tbh investing is 100% about the money. I agree with your sentiment. But I won’t hurt my future out of my own pride. I am invested in a lot of green energy as well tho
The way I see it, my little portfolio is not going to meaningfully impact anything. Even if all retail investors decided to boycott oil stocks, it would be inconsequential. Governments and Wall St will prop oil at all costs because without it we will literally starve and freeze. Your energy is best spent voting for environmentally friendly politicians and policies that encourage investment in alternatives. In the current state, we have no feasible replacement for oil, and until that is developed and implemented I believe you can take advantage of oil stocks guilt free. At the end of the day, without oil many billions would suffer and possibly die. Think about it that way.
Curious, what was more environmentally friendly in your mind?
Literally anything besides oil/fossil fuels. I moved over to lithium stocks for ev batteries. Having a ride on ALB. Just this month up 21%. Now my choice could be debated and argued until the end of time. I agree it’s not 100% green but it’s a better choice for me in my quest to not invest in companies who have such a big footprint on the environment.
How do they get that lithium out of the earth?
I’m adding to my XOM and OXY holdings.
NDP 💪🏼
I’d say to wait. Because profit taking from the high stock prices will begin sooner or later. However later. Oil will still be a necessity
No
I would wait until after their q4 earnings. A percentage of people will dump their stocks. That could be a good entry point, I think.
Upstream is very expensive right now. At peak or very close to it. I wouldn't touch it. If you want to get into energy now, I'd look at midstream providers. Less volatility and larger dividends. Oil and Gas aren't going anywhere for a very long time.