3 Top Energy Stocks Hitting New 90-Day Lows

Hunting for a bargain? This group of beaten-down stocks, including Enbridge (TSX:ENB)(NYSE:ENB), might provide the value you’re looking for.

| More on:
Where to Invest?

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

Hey there, Fools. I’m back to call attention to three stocks that have been walloped over the past 90 days. Why? Because the biggest stock market gains are made by buying attractive companies: during times of extreme market bearishness; and when they’re available at a clear discount to intrinsic value.

This week, we’ll take a look three energy stocks that have been particularly bruised in recent months.

Let’s get to it.

Down buy the bay

Kicking things off is embattled oil and gas producer Baytex Energy (TSX:BTE)(NYSE:BTE), which is down 13% over the past 90 days and trading near its three-month low of $1.90 per share.

The stock has been walloped over the past year on debt concerns, but recent results suggest a brighter outlook ahead. In Q1, revenue spiked 58.5%, production improved 2%, and adjusted funds flow clocked in at a whopping $221 million.

Management even managed to reduce its net debt $90 million during the quarter.

“Further deleveraging remains a top priority with adjusted funds flow now exceeding the midpoint of our capital guidance by C$350M, which will support accelerated debt repayment,” said Baytex.

Baytex shares are off a significant 65% over the past year.

Natural selection

Next up, we have natural gas play Encana (TSX:ECA)(NYSE:ECA), whose shares are down 31% over the past 90 days and trading near their three-month lows of $6.40.

A steep decline in natural gas prices has taken its toll on Encana, but recent signs tell us that the stock is a bargain.

Earlier this week, management announced plans to buy back as much as $213 million in additional common shares in July. The move would complete its previously announced $1.25 billion repurchase program.

“This is part of our sustainable business model which profitably grows liquids, generates free cash and returns significant cash to shareholders through dividends and opportunistic buybacks,” said President and CEO Doug Suttles.

Encana shares are down more than 60% over the past year.

Profit pipeline

Rounding out our list is pipeline and midstream giant Enbridge (TSX:ENB)(NYSE:ENB), which is down 7% over the past 90 days and trading near its three-month lows of $45.50 per share.

Recent market turbulence has weighed on the stock, providing long-term dividend investors with an attractive opportunity. Currently, Enbridge provides a rather juicy dividend yield of 6.2%. More important, it’s backed by highly stable cash flows.

In the most recent quarter, distributable cash flow increased from $2.31 billion in the year-ago period to an impressive $2.76 billion.

“[F]rom a strategic standpoint, the actions we’ve taken over the past year have put us in a position of strength going forward, and we’re seeing the benefits of this already,” said President and CEO Al Monaco.

Enbridge shares are up a steady 8% over the past year.

The bottom line

There you have it, Fools: three contrarian stocks worth checking out.

As always, don’t see them as formal recommendations. Instead, view them as a starting point for more research. Trying to catch a falling knife can be hazardous to your wealth, so plenty of homework is still required.

Fool on.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada.

More on Energy Stocks

A meter measures energy use.
Energy Stocks

Energy Investing: What Every Canadian Needs to Know

Here’s what savvy Canadian investors need to know about energy investing today, straight from Motley Fool Hidden Gems advisor Jim…

Read more »

edit Businessman using calculator next to laptop
Dividend Stocks

Gold vs. Oil: Which Commodity Is a Stronger Bet for Inflation?

Increasing commodity prices make gold stocks and oil stocks attractive assets to own, but oil stocks might be the better…

Read more »

TSX Today
Energy Stocks

TSX Today: What to Watch for in Stocks on Thursday, June 23

The U.S. Federal Reserve chair Jerome Powell’s testimony before Congress could continue to keep TSX stocks highly volatile today.

Read more »

Canadian energy stocks are rising with oil prices
Energy Stocks

Why Tourmaline Oil Stock Still Looks Strong

Tourmaline Oil has been on a dividend-hike streak this year.

Read more »

oil and natural gas
Energy Stocks

3 Cheap TSX Energy Stocks With Fast-Growing Dividends

TSX energy stocks are down 10% in the past week. Here are three cheap oil stocks I'd pick up for…

Read more »

Group of industrial workers in a refinery - oil processing equipment and machinery
Energy Stocks

From a Big Bank: Suncor (TSX:SU) Is the Best-in-Class Operator

A big bank recommends a buy rating for an oil bellwether because of its strong free cash flows and restored…

Read more »

TSX Today
Energy Stocks

TSX Today: Why Stocks Could Fall on Wednesday, June 22

Renewed selling pressure in global stock markets and a sharp drop in commodity prices could take TSX stocks lower at…

Read more »

Oil pumps against sunset
Energy Stocks

Suncor Energy (TSX:SU): Is the Stock Now Oversold?

Suncor stock looks cheap today. Here's why.

Read more »