If you’re looking for some excitement in your portfolio, you can consider these two energy companies which have pulled back to more attractive levels.
In fact, according to analysts, their shares have the potential to rise 24-50%! They also offer decent monthly dividends while you wait for their shares to appreciate.
In fact, since 2003, Vermilion Energy has steadily increased its annual payout by 26% from $2.04 per share to $2.58 per share.
Other than its sustainable distribution, Vermilion Energy is also known for its international diversification. This year, the company estimates it’ll produce 44% of oil, 52% of natural gas, and 4% of natural gas liquids.
Specifically, it expects its production diversification to be 28% Brent oil (18% from France, 9% from Australia, and 1% from Germany), 16% WTI oil (14% from Canada and 2% from the United States), 31% European gas (15% from Ireland, 11% from the Netherlands, 5% from Germany), and 21% Canadian gas.
Vermilion Energy enjoys higher European gas prices. Indeed, its European natural gas assets should continue to generate meaningful free cash flow.
In February, Vermilion Energy’s director and officer ownership was meaningful at 5%.
More importantly, after the 14% pullback from its December high, the shares offer an attractive yield of nearly 5.3%.
The analyst consensus at Reuters, across 15 analysts, has a mean 12-month price target of $61, which implies an upside potential of about 24% from the recent trading price of about $49.20 per share.
Torc Oil And Gas Ltd. (TSX:TOG) is a light-oil producer with low-decline and high-netback assets and operations in southeast Saskatchewan and Alberta. It maintains a healthy balance sheet and is focused on per-share growth through organic development and strategic acquisitions.
Under the most conservative scenario in which the WTI oil price maintains at US$50, Torc expects to maintain a conservative payout of 87% after accounting for capital spending and dividends. If the WTI price rises to US$55, the payout ratio will quickly fall to 73%.
After a nice pullback of 20% from the beginning of the year, Torc’s shares are more attractive. At roughly $6.80 per share, it offers a dividend yield of about 3.5%.
In fact, the analyst consensus at Reuters, across 14 analysts, has a mean 12-month price target of $10.30, which implies there’s upside potential of about 50% from the recent trading price.
If you’re bullish on oil and gas, consider Vermilion and Torc for potentially outsized capital gains, as they’re more attractive after the recent pullbacks. They also offer a nice yield of 5.3% and 3.5%, respectively.
Iain Butler, Lead Adviser of Stock Advisor Canada, recommended this little tech darling to thousands of loyal members last March... and those that followed his advice are up 127.7% (they’ve already made 2X their money!).
Not to mention this tiny Eastern Ontario company has already been recommended by both Motley Fool co-founders, David and Tom Gardner, because of its amazing similarity to an “early stage” Amazon.
Find out why Tom Gardner was recently on BNN’s Money Talk raving about this company, and how you can read all about it inside Stock Advisor Canada. Click here to unlock all the details about his Canadian rule breaker!
Fool contributor Kay Ng has no position in any stocks mentioned.