Oil prices gathered momentum on Thursday on the back of OPEC production cuts and continued anxiety over the future of the Iran nuclear deal. Some of the top Canadian energy stocks have stalled after making huge gains on the back of this rally. Although many of the gains for oil may be priced in ahead of the decision on Iran from U.S. president Donald Trump, there is still reason for optimism going forward.
The S&P/TSX Composite Index rebounded in late April on the strength of energy stocks. Today, we are going to look at three energy stocks that offer solid income to diversify a TFSA portfolio.
Imperial Oil Ltd. (TSX:IMO)(NYSE:IMO)
Imperial Oil is a Calgary-based oil and gas company. Shares of Imperial Oil fell 1.1% on May 3, and the stock had climbed over 15% month over month before trading opened on May 4. The stock sunk to year-over-year lows in early April before the oil rally sparked a surge. The company released its first-quarter results on April 27.
Imperial Oil reported that it generated $1 billion in cash from operations in Q1 2018. It hiked its quarterly dividend by 20% to $0.19 per share, representing a 1.6% dividend yield. Net income increased to $516 million, or $0.62 per share, compared to $333 million, or $0.39 per share, in Q1 2017. The company also announced that it would ramp up its share-buyback program in an effort to return value to shareholders.
Production averaged 370,000 barrels per day, and Imperial Oil also announced that Esso and Mobil-branded network now exceeds 2,000 sites across Canada. Spiking gas prices will likely provide a boost to its revenue in these areas in the spring and summer.
Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG)
Crescent Point is a Calgary-based petroleum and natural gas company. Shares of Crescent Point plunged 7.82% on May 3 but were still up 21% month over month before trading opened on May 4. The company released its first-quarter results on May 3.
The company posted a $91 million net loss in the first quarter compared to net earnings of $119 million in Q1 2017. The results have set off a new round of criticism aimed at CEO Scott Saxberg ahead of a crucial shareholders meeting. The call for change is being led by Cation Capital. Crescent Point also made progress in reducing capital expenditures in the quarter.
The stock still offers a quarterly dividend of $0.09 per share, representing a 3.4% dividend yield.
Inter Pipeline Ltd. (TSX:IPL)
Inter Pipeline is yet another Calgary-based oil and gas company. Shares of Inter climbed 5.5% month over month as of close on May 3, but the stock was down 10% in 2018 before trading opened on May 4. The company is expected to release its first-quarter results on May 7.
In 2017, Inter reported record funds from operations of $991 million, and net income rose 10% year over year to $527 million. Average annual throughput volumes on its pipeline systems average a record 1.39 million barrels per day. The company also announced a quarterly dividend of $0.42 per share, representing a 7% dividend yield.
