Motley Fool Premium
  1. Category
    2. /
  2. Investing
    3. /
  3. Energy Stocks
    4. /

Energy Stocks

What are energy stocks? 

Energy stocks represent partial ownership in companies that supply electricity and fuel for the global economy. The energy sector in Canada is vast, comprising a large portion of the TSX. Energy stocks include: 

  • Liquefied natural gas companies
  • Natural gas companies 
  • Oil companies 

(Renewable energy stocks are part of the TSX’s utilities sector.)

How can you pick energy stocks?

1. Look for companies with a promising future 

It’s no surprise that the energy sector is under intense scrutiny. With climate change at the front of many people’s minds (from governments to investors), energy companies, old and new, are constantly adapting to a new world. Many people want cleaner energy. And it’s the energy sector’s challenge to make clean energy available — and profitable, too. 

For that reason, investors will do well to look for innovative companies that are actively solving contemporary energy problems. Though we’re not suggesting investors ignore bigger companies in oil or natural gas, we are suggesting you keep an eye on the future as you’re picking your energy stocks. 

Given the direction the world is going, ask yourself: who will be around in 20, 30, or even 40 years? That’s one of the biggest questions you can answer as an energy stock investor. 

2. Analyze an energy company’s financial standing

The future of an energy company depends in part on how it’s handling its finances now. Given that prices within the energy sector are extremely volatile — just look at how the price of gas fluctuates — you want to be sure an energy company has the financial strength to withstand a recession. Some factors you may want to analyze include: 

  • Strong balance sheet: the company should have lots of liquid cash on hand, as well as a capacity to borrow (if needed). It should also have low amounts of debt and a high investment grade. 
  • Low production costs: the company shouldn’t be spending the majority of its revenue on producing energy. The company should have a stable revenue with minimal exposure to price fluctuations. 
  • Conservative dividend payout ratio: though everyone likes to make money on dividends, if a company dishes too much out, it could end up cutting or reducing its dividend program during hard times. 

3. Check here for our writer’s picks

Our writers are constantly analyzing the energy sector, as they look for Canadian energy stocks that are growing, as well as those that are under- or over- valued. Keep checking back here to see which stocks they recommend — and which they don’t. 

[KevelPitch/]

In addition, you should read up on our Renewable Energy Stocks list.

Check back here for the most up to date information about energy stocks.

Top Articles

Energy Stocks

2 Top TSX Energy Stocks to Buy in January 2023

| Robin Brown

Here are two top TSX energy stocks that had a great year in 2022 and could be primed for strong…

Read more »

An engineer works at a hydroelectric power station, which creates renewable energy.
Energy Stocks

Why Algonquin Power & Utilities Stock Slid 49.3% Last Year

| Tony Dong, MSc, CETF®

Here's why shares of AQN fell hard last year.

Read more »

Energy Stocks

Is CNQ Stock a Buy in January 2023?

| Andrew Walker

CNQ stock is down from the 2022 high. Is it time to buy?

Read more »

Energy Stocks

Worried About a Recession? 3 TSX Giants to Outpace the Market

| Aditya Raghunath

Recession-resistant TSX stocks such as Fortis and Hydro One are well poised to deliver outsized returns to shareholders in 2023.

Read more »

A worker overlooks an oil refinery plant.
Energy Stocks

The Best Energy Dividend Stock for a Decade of Passive Income

| Aditya Raghunath

Canadian Natural Resources is a top TSX stock that has delivered stellar gains to long-term investors. Let's see why CNQ…

Read more »

oil and gas pipeline
Energy Stocks

Enbridge Is a High-Yielding Canadian Dividend Stock to Buy Now and Own Forever

| Adam Othman

Consider adding Enbridge stock to your portfolio, as it still trades below its all-time highs to capture its high-yielding dividend…

Read more »

Dividend Stocks

3 Growth Stocks You Can Buy Right Now with Less Than $100

| Christopher Liew, CFA

Capital of less than $100 is enough to buy one of these three promising growth stocks that don't belong to…

Read more »

Energy Stocks

2 Energy Stocks You Can Buy Right Now to Play The EV Boom

| Adam Othman

Add these two Canadian renewable energy stocks to capitalize on the growing EV popularity.

Read more »

Recent Energy Stocks News

Dividend Stocks

Retirees: 3 Top Safe, High-Yield Stocks for You

| Kay Ng

AltaGas Ltd. (TSX:ALA) and two other dividend stocks offer safe yields of 6-9%.

Read more »

Dividend Stocks

Buy These Energy Stocks Now for Big Upside in 2018

| Karen Thomas, MSc, CFA

Pason Systems Inc. (TSX:PSI) is a top-notch energy stock and dividend stock, with a 22% one-year return and a 3.3%…

Read more »

Dividend Stocks

Retirees: Get Safe Income Here, and No, it’s Not From Banks

| Kay Ng

Which of Inter Pipeline Ltd. (TSX:IPL) and its two other peers should you invest in?

Read more »

Dividend Stocks

Income Investors: 2 Attractive Dividend Stocks Yielding 6.5%

| Andrew Walker

Gibson Energy (TSX:GEI) and one other niche player in the midstream energy sector deserve a closer look. Here's why.

Read more »

Dividend Stocks

Monthly TFSA Income: Lock In This Scintillating 6.9% Yield by August 31

| Brian Pacampara, CFA

Vermilion Energy Inc (TSX:VET)(NYSE:VET) is a monthly dividend stock that investors seem to be ignoring. Here's why that's a big…

Read more »

Umbrella protecting words "Take care of yourself" from rain
Dividend Stocks

Addressing Investor Concerns on Fortis Inc. (TSX:FTS)

| Demetris Afxentiou

Fortis Inc. (USA)(NYSE:FTS) continues to offer a growing dividend and reliable steady growth, but is that stability waning?

Read more »

Energy Stocks

Will Oil Prices Reach Triple Figures by the End of 2018?

| Matt Smith

Even if crude remains range bound until the end of 2018, Parex Resources Inc. (TSX:PXT) will perform strongly.

Read more »

Dividend Stocks

Are These the Best Canadian Energy Stocks to Buy for Easy Money?

| Victoria Hetherington

Inter Pipeline Ltd. (TSX:IPL) and two other energy-related stocks pay big dividend yields at the moment. Should you buy for…

Read more »

Energy Stocks

Bank of America Thinks Enbridge Inc (TSX:ENB) Can Fly 40%: Here Are 3 Simple Reasons Why

| Brian Pacampara, CFA

This Wall Street analyst thinks Enbridge Inc (TSX:ENB)(NYSE:ENB) has whopping upside of 40%. Here are the three big reasons behind…

Read more »

Dividend Stocks

2 Solid Dividend Stocks for Your TFSA Retirement Fund

| Andrew Walker

Here's why Sun Life Financial Inc. (TSX:SLF)(NYSE:SLF) and another top Canadian dividend stock deserve to be on your TFSA radar.

Read more »

The Motley Fool
Energy Stocks

This Need-to-Know Strategy Allows Investors to Get Rich While Saving the World!

| Joey Frenette

Why Suncor Energy Inc. (TSX:SU)(NYSE:SU) may not be the best bet, as the trend of ESG investing takes off.

Read more »

Energy Stocks

Prepare for This Colombian Natural Gas Producer to Soar

| Matt Smith

Latest results indicate that Canacol Energy Ltd. (TSX:CNE) is on track to achieve its 2018 guidance and become a leading…

Read more »

Dividend Stocks

3 Stable Dividend-Growth Stocks From the Energy Sector

| Kay Ng

Suncor Energy Inc. (TSX:SU)(NYSE:SU) and two others are some of the most stable energy stocks that offer increasing dividends.

Read more »

Umbrella protecting words "Take care of yourself" from rain
Energy Stocks

Which Energy Investment Is Better for Your Portfolio?

| Demetris Afxentiou

Enbridge Inc. (TSX:ENB)(NYSE:ENB) and Inter Pipeline Ltd. (TSX:IPL) are two of the most widely-known pipeline investments on the market, but…

Read more »

grow your investments
Dividend Stocks

Why Aecon (TSX:ARE) Stock Is up 11.7% Over the Past Month

| Jason Phillips

Shares in Aecon Group Inc (TSX:ARE) are up 11.7% over the past month. Find out why.

Read more »

hydroelectricity facility
Dividend Stocks

Will the Latest Leadership Shake-up at Hydro One Ltd (TSX:H) Send Shares Soaring?

| Jason Phillips

The newly elected PC government is shaking things up at Hydro One Ltd (TSX:H). Is this the catalyst that investors…

Read more »

Dividend Stocks

What Is the Yield Curve Revealing About the Stock Market?

| Jason Phillips

With interest rates on the rise, find out what it means for companies like Royal Bank of Canada (TSX:RY)(NYSE:RY), Great-West…

Read more »

Dividend Stocks

Energy Stocks on the Cheap! Which One Will You Buy?

| Kay Ng

Be careful of cheap energy stocks, such as Baytex Energy Corp. (TSX:BTE)(NYSE:BTE).

Read more »

Dividend Stocks

The Top 5 High-Growth Stocks That Could Make You Rich

| Victoria Hetherington

Park Lawn Corporation (TSX:PLC) and four other stocks are signaling high growth in earnings -- and they’re nothing to do…

Read more »

Dividend Stocks

What it Feels Like to Be in a Market Crash

| Kay Ng

With the North American stock markets near all-time highs, now’s a good time to recap what can happen to even…

Read more »

Dividend Stocks

3 Cheap Energy Stocks to Buy Now

| Stephanie Bedard-Chateauneuf, MBA

I present three energy stocks, including Suncor Energy Inc. (TSX:SU)(NYSE:SU), that are very cheap relative to their high-growth outlook.

Read more »

Dividend Stocks

2 Dividend Stocks to Earn Growing Monthly Income

| Haris Anwar

Inter Pipeline Ltd. (TSX:IPL) is one of two dividend stocks that could provide growing monthly income to investors.

Read more »

The Motley Fool
Dividend Stocks

5 Reasons Why a Dollar-Cost Averaging Strategy Can Save You Time and Make You Money

| Jason Phillips

Dollar-cost averaging is a proven strategy that can help reduce the frustration many investors deal with in trying to “time”…

Read more »

Dividend Stocks

Wealth Creators: 3 Dividend Aristocrats That Are Beginning to Rebound off Their 52-Week Lows

| Jason Phillips

Shares in these three dividend aristocrats, including Bank of Nova Scotia (TSX:BNS)(NYSE:BNS), are rebounding off their 52-week lows and offer…

Read more »

The Motley Fool
Dividend Stocks

2 Top Energy Stocks to Buy and Hold in Your TFSA

| Haris Anwar

Suncor Energy Inc. (TSX:SU)(NYSE:SU) is one of two top energy stocks that TFSA investors should consider for their portfolios.

Read more »

Dividend Stocks

2 Safe and Reliable Dividend Stocks for Your RRSP

| Karen Thomas, MSc, CFA

Fortis Inc. (TSX:FTS) (NYSE:FTS) and Enbridge Inc. (TSX:ENB) (NYSE:ENB) boast long histories of reliable dividend income that have made shareholders…

Read more »

Dividend Stocks

Buy Inter Pipeline Ltd. (TSX:IPL) Today and Lock In a 7% Yield

| Matt Smith

Boost income and growth by investing in Inter Pipeline Ltd. (TSX:IPL).

Read more »

The Motley Fool
Dividend Stocks

3 Top Monthly Dividend-Paying Stocks for Retirement

| Mat Litalien, MBA

Monthly dividend payers such as AltaGas Ltd. (TSX:ALA) can provide reliable and stable income for retirees.

Read more »

Dividend Stocks

Retirement Investing? These 4 Dividend Rock Stars Will Make Your RRSP Sing!

| Victoria Hetherington

Fortis Inc. (TSX:FTS)(NYSE:FTS) and three other well-known dividend payers are your retirement picks for the weekend!

Read more »

Energy Stocks

Save the Planet and Get Rich With This Energy Provider

| Demetris Afxentiou

Innergex Renewable Energy Inc. (TSX:INE) holds massive long-term potential for investors that are looking to capitalize on the growing shift…

Read more »

Energy Stocks

Income Investors: Should You Own BCE Inc. (TSX:BCE) or Suncor Energy Inc. (TSX:SU) Stock Today?

| Andrew Walker

BCE Inc. (TSX:BCE)(NYSE:BCE) and Suncor Energy Inc. (TSX:SU)(NYSE:SU) are both top-quality dividend stocks. Is one a bet bet right now?

Read more »

The Motley Fool
Dividend Stocks

3 Top Energy Stocks That Are Rich in Cash Flow and Shareholder Returns

| Karen Thomas, MSc, CFA

Investors would be wise to consider Canadian Natural Resources Ltd. (TSX:CNQ)(NYSE:CNQ) and Pason Systems Inc. (TSX:PSI) for their high dividend…

Read more »

wind generation facility
Dividend Stocks

3 High-Yield Renewable Energy Stocks for a Green Energy Portfolio

| Andrew Walker

TransAlta Renewables Inc. (TSX:RNW) and another two green energy plays provide an average yield of more than 6%.

Read more »

Dividend Stocks

2 Top Canadian Dividend Stocks for a Self-Directed Retirement Fund

| Andrew Walker

Here's why Bank of Montreal (TSX:BMO)(NYSE:BMO) and a market leader in the energy infrastructure sector deserve to be on your…

Read more »

The Motley Fool
Energy Stocks

Is This Oil Sands Stock a Top Contrarian Pick Today?

| Andrew Walker

Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) might be on the verge of a significant rebound.

Read more »

Dividend Stocks

Don’t Miss This Opportunity to Buy Enbridge Inc. (TSX:ENB)

| Matt Smith

Latest results indicate that Enbridge Inc. (TSX:ENB)(NYSE:ENB) is ready to soar.

Read more »

Energy Stocks

These Canadian Energy Stocks Could Surge or Dip on Iranian Oil Developments

| Victoria Hetherington

Vermilion Energy Inc (TSX:VET)(NYSE:VET) could soar on higher oil if Iran follows through with its threat to close the Strait…

Read more »

The Motley Fool
Dividend Stocks

This Is the Best Canadian Renewable Energy Stock – But Should You Buy It?

| Victoria Hetherington

Northland Power (TSX:NPI) is a great alternative to oil-weighted energy stocks, with a forward-looking style. But is it a buy…

Read more »

Dividend Stocks

These 3 Dividend Stocks Are an Absolute Steal!

| Kay Ng

Vermilion Energy Inc. (TSX:VET)(NYSE:VET) and two other stocks offer double-digit returns in the next 12 months, while spitting out generous…

Read more »

Energy Stocks

Will Obsidian Energy Ltd. (TSX:OBE) Ever Unlock Value for Investors?

| Matt Smith

Latest results indicate that Obsidian Energy Ltd.'s (TSX:OBE)(NYSE:OBE) performance is improving but it still has a long way to go…

Read more »