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

The Motley Fool
Energy Stocks

The 2 Best Ways to Play the Next Leg up in the Oil Rally

| Adam Mancini

There is good reason to believe the oil rally has paused. Investors should take this opportunity to add to (or…

Read more »

The Motley Fool
Energy Stocks

Crescent Point Energy Corp. or Baytex Energy Corp.: Which Stock Is the Best Oil Play?

| Andrew Walker

Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG) and Baytex Energy Corp. (TSX:BTE)(NYSE:BTE) are both popular energy bets. Is one a smarter pick…

Read more »

The Motley Fool
Energy Stocks

Ignore the Brexit: 3 Growing Oil Stocks Worth Buying

| Matt Smith

Suncor Energy Inc. (TSX:SU)(NYSE:SU), Vermilion Energy Inc. (TSX:VET)(NYSE:VET), and Gran Tierra Energy Inc. (TSX:GTE)(NYSE:GTE) continue to grow despite the prolonged…

Read more »

The Motley Fool
Energy Stocks

Brookfield Asset Management Inc. Is Betting Big on Renewables

| Matt DiLallo

Brookfield Asset Management Inc. (TSX:BAM.A)(NYSE:BAM) is working on several deals in the renewables sector.

Read more »

The Motley Fool
Dividend Stocks

Retirees: Do You Own These 3 Perpetual Dividend Machines?

| Nelson Smith

Looking for yield? A portfolio of Shaw Communications Inc. (TSX:SJR.B)(NYSE:SJR), Inter Pipeline Ltd. (TSX:IPL), and Boardwalk REIT (TSX:BEI.UN) offers a…

Read more »

The Motley Fool
Energy Stocks

Thinking of Buying More Baytex Energy Corp.? Buy Vermilion Energy Inc. Instead

| Adam Mancini

Baytex Energy Corp. (TSX:BTE)(NYSE:BTE) has become one of the more popular and better-performing ways to play the oil-price recovery. Instead…

Read more »

The Motley Fool
Dividend Stocks

Should Enbridge Inc. or Royal Bank of Canada Be in Your RRSP?

| Andrew Walker

Investing in dividend-growth stocks such as Enbridge Inc. (TSX:ENB)(NYSE:ENB) and Royal Bank of Canada (TSX:RY)(NYSE:RY) can help investors build significant…

Read more »

The Motley Fool
Dividend Stocks

3 Top Energy Stocks With Yields of 3-4%

| Joseph Solitro

Looking to add a dividend stock to your portfolio? If so, consider energy stocks such as Canadian Utilities Limited (TSX:CU),…

Read more »

The Motley Fool
Energy Stocks

TransCanada Corporation Challenging Keystone Rejection and Completing $13 billion Acquisition

| Demetris Afxentiou

TransCanada Corporation (TSX:TRP)(NYSE:TRP) has completed the acquisition of Columbia Pipeline Group Inc. nearly a year after the ill-fated Keystone XL…

Read more »

The Motley Fool
Energy Stocks

1 New Rule Penn West Petroleum Ltd. Really Doesn’t Like

| Matt DiLallo

With assets still left to sell, Penn West Petroleum Ltd. (TSX:PWT)(NYSE:PWE) is balking at a new rule that could limit…

Read more »

The Motley Fool
Dividend Stocks

Retirees: These 3 Monthly Dividend Payers Are as Good as a Pension

| Nelson Smith

Looking for consistent dividends? Look no further than Altagas Ltd. (TSX:ALA), Crombie Real Estate Investment Trust (TSX:CRR.UN), and Boston Pizza…

Read more »

The Motley Fool
Energy Stocks

2 Renewable Energy Investments for Your Portfolio

| Demetris Afxentiou

Innergex Renewable Energy Inc. (TSX:INE) and TransAlta Renewables Inc. (TSX:RNW) are steadily replacing fossil fuel power generators, signaling a major…

Read more »

The Motley Fool
Energy Stocks

Buy Suncor Energy Inc. and Ride its Acquisition Ship

| Jacob Donnelly

Because of its size, Suncor Energy Inc. (TSX:SU)(NYSE:SU) has been gobbling up assets, making it even stronger. That could be…

Read more »

The Motley Fool
Energy Stocks

Baytex Energy Corp.’s Tax Strategy Didn’t Quite Work

| Matt DiLallo

Baytex Energy Corp. (TSX:BTE)(NYSE:BTE) bought a bunch of loss-making private companies only to get hit with a big tax bill.

Read more »

The Motley Fool
Energy Stocks

Crescent Point Energy Corp.: Is This Your Best Oil Bet?

| Andrew Walker

Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG) has pulled back in recent weeks. Should you buy?

Read more »

The Motley Fool
Energy Stocks

Suncor Energy Inc. Is Now Looking East for Acquisitions

| Matt DiLallo

After being burned by the oil sands, Suncor Energy Inc. (TSX:SU)(NYSE:SU) looks offshore.

Read more »

The Motley Fool
Dividend Stocks

Is TransCanada Corporation About to Be US$15 Billion Richer?

| Nelson Smith

TransCanada Corporation (TSX:TRP)(NYSE:TRP) could end up being US$15 billion richer if NAFTA cooperates. Is that reason enough to buy shares…

Read more »

The Motley Fool
Energy Stocks

Baytex Energy Corp.: Is the Party Over?

| Andrew Walker

Baytex Energy Corp. (TSX:BTE)(NYSE:BTE) had a great run. Is there more in the tank?

Read more »

The Motley Fool
Dividend Stocks

Brexit: 4 Negative Effects on the Stock Market

| Kay Ng

The Brexit added volatility to the stock market, but selective groups of stocks are more vulnerable to declines, including cyclical…

Read more »

The Motley Fool
Dividend Stocks

3 Pipeline Stocks With Yields up to 5% to Buy Now

| Joseph Solitro

Enbridge Inc. (TSX:ENB)(NYSE:ENB), TransCanada Corporation (TSX:TRP)(NYSE:TRP), and Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA) offer high and safe yields of 3-5%. Which should…

Read more »

Dividend Stocks

Worried About the Brexit? Buy 1 of These 3 Top Utility Stocks

| Joseph Solitro

Looking to minimize your risk in today’s uncertain times? If so, consider utility stocks such as Fortis Inc. (TSX:FTS), Emera…

Read more »

The Motley Fool
Energy Stocks

Citigroup Inc. Upgrades Suncor Energy Inc.: Is Cash Flow About to Roar?

| Ryan Vanzo

Suncor Energy Inc. (TSX:SU)(NYSE:SU) is betting big on rising oil.

Read more »

The Motley Fool
Energy Stocks

How to Profit From the Clean Energy Boom

| Adam Mancini

Renewable energy is expected to demonstrate rapidly accelerating growth over the next several decades. Profit from this trend with names…

Read more »

Dividend Stocks

Brexit: Don’t Sell Because Share Prices Fall

| Kay Ng

When the market falls, there's no rush to sell. Instead, investors should buy shares in quality companies such as Toronto-Dominion…

Read more »

The Motley Fool
Energy Stocks

A Peek Inside the New Way Forward for Penn West Petroleum Ltd.

| Matt DiLallo

With phase one complete, Penn West Petroleum Ltd. (TSX:PWT)(NYSE:PWE) is preparing to start phase two of its transformation plan.

Read more »

The Motley Fool
Dividend Stocks

Income Investors: This Energy Stock Has Paid 222 Consecutive Dividends

| Nelson Smith

Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA) hasn't missed a dividend since its 1997 IPO.

Read more »

Energy Stocks

Encana Corporation Strikes Another Transformational Deal

| Ryan Vanzo

In an effort to shed assets, Encana Corporation (TSX:ECA)(NYSE:ECA) unloaded one of its core properties. What's next?

Read more »

The Motley Fool
Dividend Stocks

4 Top Renewable Energy Stocks With Yields of 4-7%

| Joseph Solitro

Brookfield Renewable Energy Partners LP (TSX:BEP.UN)(NYSE:BEP), TransAlta Renewables Inc. (TSX:RNW), Pattern Energy Group Inc. (TSX:PEG)(NASDAQ:PEGI), and Innergex Renewable Energy Inc.…

Read more »

The Motley Fool
Energy Stocks

Suncor Energy Inc.’s Financial Maneuvering Continues

| Matt DiLallo

After a big buying binge, Suncor Energy Inc. (TSX:SU)(NYSE:SU) is buying back 10% of its debt to improve its financial…

Read more »

The Motley Fool
Energy Stocks

Encana Corporation: Is it Time to Buy?

| Andrew Walker

Encana Corporation (TSX:ECA)(NYSE:ECA) is up 50% in 2016. Are more gains on the way?

Read more »

The Motley Fool
Dividend Stocks

Brookfield Renewable Energy Partners LP Might Be a Smart Bet for Income Investors

| Jacob Donnelly

Because of its diverse asset base and strong growth perspectives, Brookfield Renewable Energy Partners LP (TSX:BEP.UN)(NYSE:BEP) can pay a lucrative…

Read more »

The Motley Fool
Dividend Stocks

Attention Income Investors: Get a 12.3% Yield From Suncor Energy Inc.

| Nelson Smith

Investors using a covered-call strategy and Suncor Energy Inc. (TSX:SU)(NYSE:SU) can generate some eye-popping income.

Read more »

The Motley Fool
Energy Stocks

Will a Brexit Affect Canadian Investors?

| Nelson Smith

A Brexit is likely bad news for Dollarama Inc. (TSX:DOL), Reitmans (Canada) Limited (TSX:RET.A), and Baytex Energy Corp. (TSX:BTE)(NYSE:BTE), but…

Read more »

The Motley Fool
Energy Stocks

Canadian Natural Resources Limited Is Ramping Production: Will Earnings Growth Follow?

| Ryan Vanzo

Canadian Natural Resources Limited (TSX:CNQ)(NYSE:CNQ) is ready to run if oil prices remain elevated.

Read more »

The Motley Fool
Energy Stocks

Crescent Point Energy Corp.: Is it Safe to Buy Today?

| Andrew Walker

Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG) has stepped back a bit after the big run. Should you buy?

Read more »

Energy Stocks

Revealed: These 3 Energy Stocks Have Huge Upside Potential

| Nelson Smith

Crescent Point Energy Corp. (TSX:CPG)(NYSE:CPG), Baytex Energy Corp. (TSX:BTE)(NYSE:BTE), and Gran Tierra Energy Inc. (TSX:GTE)(NYSE:GTE) are poised to do very…

Read more »

The Motley Fool
Energy Stocks

Is Suncor Energy Inc. Getting Ready to Make More Deals?

| Matt Smith

These attributes make now the time to add Suncor Energy Inc. (TSX:SU)(NYSE:SU) to your portfolio.

Read more »

The Motley Fool
Energy Stocks

Is TransAlta Corporation a Good Investment?

| Demetris Afxentiou

TransAlta Corporation (TSX:TA)(NYSE:TAC) may have posted improved results in the most recent quarter, but the company still has a ways…

Read more »

The Motley Fool
Energy Stocks

Suncor Energy Inc. Is Gearing Up for More Deals

| Matt DiLallo

Suncor Energy Inc. (TSX:SU)(NYSE:SU) announced that it's seeking to raise $2.5 billion in cash.

Read more »

The Motley Fool
Dividend Stocks

Millennials: 2 Top Dividend-Growth Stocks to Help You Retire Rich

| Andrew Walker

Here's how investing in dividend-growth stocks such as Enbridge Inc. (TSX:ENB)(NYSE:ENB) and Fortis Inc. (TSX:FTS) can help young investors save…

Read more »