There was little surprise after Exxon Mobil posted stunning results for the latest quarter, including a massive $56 billion profit for 2022. While shareholders of the energy giant were thrilled, the White House scolded the company for what it deemed to be excessive profits at the expense of consumers who are paying high prices at the pump. That is despite the pump price plummeting since last summer, and just like that, the “windfall profits tax” threat was back on the table.
The reality for investors is that demand is growing and will continue to as China reopens and economies around the world improve. That, combined with policies of the current administration that are anti-fossil-fuel, likely means that the supply and demand imbalance may continue for some time.
With February typically a so-so month for stocks, and after a very solid January, it makes sense for investors maybe to take some profits and move to dividend-paying energy ideas. We screened our 24/7 Wall St. energy research database for companies with Buy-rated stocks that paid at least an 8% dividend. The following five top stocks came up, and all make sense for growth and income investors. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Antero Midstream
With shares trading near $11 apiece, this very well-run company offers a huge total return package. Antero Midstream Corp. (NYSE: AM) owns, operates and develops midstream energy infrastructure. It operates through two segments.
The Gathering and Processing segment includes a network of gathering pipelines and compressor stations that collects and processes production from Antero Resources’ wells in West Virginia and Ohio.
The Water Handling segment delivers fresh water and offers other fluid handling services, such as wastewater transportation, disposal and treatment, as well as high-rate transfer services.
Investors receive an 8.26% distribution. Wells Fargo has a $13 target price on Antero Midstream stock. The consensus target is $11.29, and shares closed on Wednesday at $10.74.
Coterra Energy
This company was formed by the closing of the $17 billion merger of Cabot Oil & Gas and Cimarex Energy in 2021. Coterra Energy Inc. (NASDAQ: CTRA) is an independent oil and gas company engaged in the development, exploration and production of oil, natural gas and natural gas liquids (NGLs) in the United States. It primarily focuses on the Marcellus Shale, with approximately 177,000 net acres in the dry gas window of the play located in Susquehanna County, Pennsylvania.