What Energy Stocks Are the Best to Buy and Hold for Years?

Not all energy stocks are worth owning, but these two energy stocks are some of the best to buy and hold for years.

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Energy stocks are always excellent businesses to own in your portfolio. Because energy is so crucial to our economy, if you can find reliable companies, they are some of the best to buy and can be core stocks in your portfolio.

In this environment, energy stocks are experiencing significant tailwinds. In addition, they are some of the only stocks that are generally benefitting from the current economic climate.

However, they’ve also been impacted recently, as fears of a potential recession rise, and the pandemic continues to be an issue in countries around the world. So, while energy stocks are trading undervalued, they offer investors an excellent opportunity to buy some of the best investments on the market today.

In addition, there are plenty of lower volatility energy stocks that you can buy and have confidence owning for years.

The energy stocks that have been gaining the most value lately, exploration and production companies, are attractive and can rapidly create value for shareholders. However, these stocks tend to be more volatile, and when commodity prices fall, they can fall significantly, too.

If you’re looking to buy energy stocks because of how important they are to our economy, here are some of the best to buy that you can have confidence owning for years.

A top Canadian Dividend Aristocrat

There’s a reason Enbridge (TSX:ENB)(NYSE:ENB) is such a popular stock among Canadian investors. The massive blue-chip energy stock has a market cap of more than $100 billion, and its operations run all across North America.

It’s extremely defensive and, therefore, reliable, as its operations are well diversified and crucial to the North American economy. Plus, with the North American energy industry having significant tailwinds right now after the recent sanctions on Russia, Enbridge is in great shape.

This is why Enbridge is one of the best energy stocks to buy. Because it’s so reliable, it’s much less volatile than energy producers. Plus, it’s constantly expanding its operations, growing its cash flow, and, therefore, increasing its dividend.

So, on top of the fact the stock offers investors a yield of more than 6% today, you can also expect to see that grow over the coming years. Therefore, Enbridge has to be considered one of the best energy stocks to buy now.

One of the best green energy stocks to buy

Another energy stock that’s a high-quality company that you can have confidence owning for years is Northland Power (TSX:NPI). Northland is actually a green energy company, but these stocks have so much long-term growth potential that they’re some of the best to buy now.

Plus, in addition to long-term growth potential, you can have the confidence to own Northland Power in your portfolio, because its operations are highly defensive. Not only is the power that these companies generate always in demand, but these companies sign power purchase agreements with lengthy contracts.

In Northland’s most recent earnings report, it not only demonstrated that it continues to execute well, but it also updated investors on its numerous growth projects set to come online in the coming years.

So, if you’re looking for the best energy stocks to buy now, not only is Northland safe and offers tonnes of growth potential, but it also provides a yield of roughly 3.1%

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 Daniel Da Costa has positions in ENBRIDGE INC and NORTHLAND POWER INC. The Motley Fool recommends Enbridge.

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