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

Energy Stocks

With a Pop in Earnings, Cenovus Energy Inc. Could Be a Buy

| Brad Macintosh

Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) is seeing high trading volume this summer. The stock is consolidating at the 50-day moving average.…

Read more »

The Motley Fool
Energy Stocks

3 Reasons Energy Stocks Such as Enbridge Inc. Can Thrive With Low Oil Prices

| Ambrose O'Callaghan

Enbridge Inc. (TSX:ENB)(NYSE:ENB) and other Canadian energy companies are robust, even in the face of long-term low oil.

Read more »

gas
Energy Stocks

Why Altagas Ltd. Is Worth No More Than $25 Per Share Today

| Chris MacDonald

Why investors considering Altagas Ltd. (TSX:ALA) should consider the company's preferred shares or bonds over its equity.

Read more »

The Motley Fool
Dividend Stocks

Freehold Royalties Ltd.: Can Investors Expect an Increase in its 4.25% Dividend Yield?

| Karen Thomas, MSc, CFA

Second-quarter results show why the best is yet to come for Freehold Royalties Ltd. (TSX:FRU).

Read more »

Dividend Stocks

Dividend Investors: Did You Miss This Company’s Earnings Call?

| Chris MacDonald

Why investors can't afford to ignore the powerful growth profile of Canadian utilities company Algonquin Power & Utilities Corp. (TSX:AQN)(NYSE:AQN).

Read more »

electric power transmission
Energy Stocks

Fortis Inc.: A Buy-and-Forget Option Your Portfolio Needs

| Demetris Afxentiou

Fortis Inc. (TSX:FTS)(NYSE:FTS) continues to defy critics and offer a growing dividend, stable growth, and plenty of upside.

Read more »

pipeline
Dividend Stocks

Why Inter Pipeline Ltd. Is Down Over 2%

| Joseph Solitro

Inter Pipeline Ltd. (TSX:IPL) is down over 2% following its Q2 earnings release. Should you buy on the dip? Let’s…

Read more »

The Motley Fool
Dividend Stocks

Enbridge Inc. vs. Hydro One Ltd.: Which Is Better?

| Haris Anwar

If you want stability in your income portfolio, Enbridge Inc. (TSX:ENB)(NYSE:ENB) and Hydro One Ltd. (TSX:H) are your best bets.

Read more »

Energy Stocks

Is Venezuela the Much-Needed Catalyst for Higher Oil Prices?

| Matt Smith

The deepening crisis in Venezuela could be the trigger for higher crude, providing a vital lifeline for Baytex Energy Corp.…

Read more »

calm, no emotion
Dividend Stocks

Dividend Investors: Ray Dalio Seeking Safety. Should You, Too?

| Haris Anwar

Some exposure to stocks such as Barrick Gold Corp. (TSX:ABX)(NYSE:ABX) is likely to be a good idea when Ray Dalio recommends…

Read more »

The Motley Fool
Energy Stocks

Is Another Rally on the Horizon for Encana Corp.?

| Joey Frenette

Here's why investors should consider buying Encana Corp. (TSX:ECA)(NYSE:ECA) following a solid second quarter.

Read more »

Energy Stocks

Contrarian Investors: Could Baytex Energy Corp. or Cameco Corp. Double by 2018?

| Andrew Walker

Baytex Energy Corp. (TSX:BTE)(NYSE:BTE) and Cameco Corp. (TSX:CCO)(NYSE:CCJ) remain under pressure. Is one on the cusp of a big recovery?

Read more »

Dividend Stocks

Young Investors: A Top Stock Pick for Your TFSA Retirement Fund

| Andrew Walker

Here's how top dividend-growth stocks such as Enbridge Inc. (TSX:ENB)(NYSE:ENB) can help you save enough for retirement.

Read more »

The Motley Fool
Dividend Stocks

Combat Rising Interest Rates With These 3 High-Growth Dividend Stocks

| David Jagielski

Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) and these two other stocks will allow you to arm yourself with the high-growing…

Read more »

Dividend Stocks

A Look at Last Week’s Earnings for Oil & Gas Companies

| David Jagielski

Canadian Natural Resources Limited (TSX:CNQ)(NYSE:CNQ) and two other oil and gas companies released quarterly earnings last week that show how the…

Read more »

oil, petroleum, refinery
Dividend Stocks

Dividend Investors: 5 Top Energy Stocks to Buy Now

| Haris Anwar

Some energy stocks, such as Canadian Natural Resources Limited (TSX:CNQ)(NYSE:CNQ) and Suncor Energy Inc. (TSX:SU)(NYSE:SU), are showing signs of a turnaround. Dividend…

Read more »

Dividend Stocks

2 Stocks With +40 Years of Dividend Growth

| Joseph Solitro

Fortis Inc. (TSX:FTS)(NYSE:FTS) and Canadian Utilities Limited (TSX:CU) are the undisputed kings of dividend growth. Which should you buy? Let’s…

Read more »

offshore wind generation
Dividend Stocks

Why Pattern Energy Group Inc. Is Down Over 3%

| Joseph Solitro

Pattern Energy Group Inc. (TSX:PEG)(NASDAQ:PEGI) is down over 3% on the heels of its Q2 results. Should you buy on…

Read more »

Dividend Stocks

Better Buy: Cenovus Energy Inc. vs. Crescent Point Energy Corp.

| Jason Phillips

Find out which of these two blue-chip names, Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) and Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG), is the…

Read more »

The Motley Fool
Energy Stocks

Contrarian Investors: Should You Buy TransAlta Corporation or Baytex Energy Corp.?

| Andrew Walker

TransAlta Corporation (TSX:TA) (NYSE:TAC) and Baytex Energy Corp. (TSX:BTE) (NYSE:BTE) have really taken a beating in recent years. Is one…

Read more »

dividends
Dividend Stocks

3 Top Dividend Stocks on Sale

| Jason Phillips

These three stocks, including Home Capital Group (TSX:HCG) offer an attractive mix of dividend income with the potential for sizeable…

Read more »

Dividend Stocks

These 3 Stocks Have Seen Profits Double in Just 3 Years

| David Jagielski

Algonquin Power & Utilities Corp (TSX:AQN)(NYSE:AQN) and these two other stocks provide strong growth and profitability and would be great…

Read more »

The Motley Fool
Energy Stocks

Is This the Beginning of the End for the Oil Industry?

| Matt Smith

The secular trend to clean energy is threatening the long-term viability of the oil industry and energy companies such as…

Read more »

Dividend Stocks

Anticipating Higher Oil Prices? Here’s a Breakdown of Canada’s Major Players

| Jason Phillips

A company like Baytex Energy Corp (TSX:BTE)(NYSE:BTE) stands to benefit most from a surge in oil prices. Here’s a breakdown…

Read more »

The Motley Fool
Dividend Stocks

Is Oil Entering a New Bull Market?

| Ryan Goldsman

With oil potentially entering a bull market, investors may be able to win big with shares of Crescent Point Energy…

Read more »

The Motley Fool
Dividend Stocks

Suncor Energy Inc. Posts a Profit in Q2: Is it Time to Buy This Energy Giant?

| Stephanie Bedard-Chateauneuf, MBA

The share price of Suncor Energy Inc. (TSX:SU)(NYSE:SU) is on the rise since it released its Q2 2017 results.

Read more »

Dividend Stocks

Why These 2 Companies Make Great Investments

| Chris MacDonald

Don't miss the forest through the trees with Fortis Inc. (TSX:FTS)(NYSE:FTS) and Canadian National Railway Company (TSX:CNR)(NYSE:CNI).

Read more »

The Motley Fool
Energy Stocks

If Oil Turns, Baytex Energy Corp. Could Be the Biggest Gainer!

| Ryan Goldsman

With the potential for a bull market in oil, investors may do well to load up on shares of Baytex…

Read more »

The Motley Fool
Dividend Stocks

Why Canadian Natural Resources Limited Is up Over 3%

| Joseph Solitro

Canadian Natural Resources Limited (TSX:CNQ)(NYSE:CNQ) announced its Q2 earnings results this morning, and its stock has reacted by rising over…

Read more »

Dividend Stocks

This Company Has the Best Dividend on the TSX

| Chris MacDonald

Why Fortis Inc. (TSX:FTS)(NYSE:FTS) has one of the best dividends of any company on the TSX today.

Read more »

Dividend Stocks

Will Negative-Beta Stocks Help Outperform the TSX?

| David Jagielski

Valeant Pharmaceuticals Intl Inc. (TSX:VRX)(NYSE:VRX) has seen returns of over 4% year to date, while the TSX has seen losses.

Read more »

The Motley Fool
Energy Stocks

New RRSP Investors: Should You Own Bank of Nova Scotia or Enbridge Inc.?

| Andrew Walker

Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) and Enbridge Inc. (TSX:ENB)(NYSE:ENB) are two of Canada's top companies. Is one more attractive right…

Read more »

Dividend Stocks

Cenovus Energy Inc. vs. Suncor Energy Inc.: Which Is Better?

| Haris Anwar

Find out if Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) or Suncor Energy Inc. (TSX:SU)(NYSE:SU) is better for your portfolio.

Read more »

The Motley Fool
Dividend Stocks

Contrarian Investors: 2 Unloved Dividend Stocks to Consider Today

| Andrew Walker

Here's why Fairfax Financial Holdings Ltd. (TSX:FFH) and Canadian Natural Resources Limited (TSX:CNQ)(NYSE:CNQ) might deserve a closer look.

Read more »

The Motley Fool
Dividend Stocks

Dividend Investors: Should You Buy Suncor Energy Inc.?

| Haris Anwar

Here is why Suncor Energy Inc. (TSX:SU)(NYSE:SU) should be included in your dividend portfolio.

Read more »

Dividend Stocks

4 High-Paying Dividend Stocks That You Should Buy

| Demetris Afxentiou

Enbridge Inc. (TSX:ENB)(NYSE:ENB) and three other stocks are great dividend-paying investments that should be part of any portfolio.

Read more »

The Motley Fool
Dividend Stocks

These 2 Energy Stocks Just Raised Their Dividends by 6-8%

| Joseph Solitro

Capital Power Corp. (TSX:CPX) and TransAlta Renewables Inc. (TSX:RNW) just raised their dividends by 6-8%. Should you buy one today?…

Read more »

Dividend Stocks

Is This Dividend-Growth Stock a Buy After an 8% Plunge?

| Haris Anwar

Here is why ATCO Ltd. (TSX:ACO.X) shares are a good buy for investors looking to add a quality dividend-growth stock in…

Read more »

Energy Stocks

Looking for Signs of a Strengthening Canadian Economy?

| Karen Thomas, MSc, CFA

Take a look at Mullen Group Ltd.’s (TSX:MTL) second-quarter results.

Read more »

The Motley Fool
Energy Stocks

Crescent Point Energy Corp. or Teck Resources Ltd.: Which Is a Better Bet Today?

| Andrew Walker

Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG) and Teck Resources Ltd. (TSX:TECK.B)(NYSE:TECK) are two of Canada's top resource stocks. Should one be…

Read more »