Best Energy Stocks to Buy: SM vs. FANG vs. ET - A Comprehensive Analysis
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The energy sector, with its vast expanse of industries and companies, offers a plethora of investment opportunities. Among the myriad of choices, three stocks stand out: SM, FANG, and ET. Let's delve into a detailed financial analysis of these stocks based on the data provided:
Industry Overview:
Both FANG and SM belong to the Oil & Gas Production industry, while ET finds its niche in the Oil & Gas Pipelines industry. These industries, while interconnected, have distinct dynamics and growth trajectories.
Volume Analysis:
The current volume, relative to the 65-day Moving Average, provides insights into the recent trading activity of these stocks:
- ET: Trading at a volume of 116% relative to its 65-day Moving Average, indicating heightened interest.
- FANG: At 79%, it's slightly below ET but still showcases a robust trading activity.
- SM: With a volume of 97%, it's close to its average, suggesting steady trading interest.
Market Capitalization:
Market capitalization offers a snapshot of the company's size and its potential influence in the industry:
- ET: Leading the pack with a market cap of $41.23B.
- FANG: Valued at $28.62B, it's a significant player in the Oil & Gas Production industry.
- SM: With a market cap of $4.81B, it's smaller compared to the other two but still holds its ground.
For context, the average market capitalization across the Oil & Gas Production industry is $3.81B, and for the Oil & Gas Pipelines industry, it's $8.29B.
Long-Term Analysis:
Using Fundamental Analysis (FA) ratings, we can gauge the long-term outlook:
- A green rating (1-33) suggests the stock is undervalued.
- A grey rating (34-66) indicates fair valuation.
- A red rating (67-100) means the stock is overvalued.
The FA Score shows how many ratings indicate the stock to be undervalued (green) or overvalued (red).
Short-Term Analysis:
Technical Analysis (TA) indicators provide insights into the short-term outlook:
- ET: 4 bullish TA indicators, suggesting a positive trend.
- FANG: Also with 4 bullish TA indicators, it mirrors ET's positive trajectory.
- SM: 3 bullish TA indicators, slightly trailing behind but still showcasing a positive trend.
If the Odds of Success for each indicator exceed 50%, the generated signal is confirmed. A green percentage (51%-90%) indicates a bullish trend, while a red percentage (51%-90%) suggests a bearish trend.
When deciding between SM, FANG, and ET, investors should consider both long-term fundamentals and short-term technicals. Currently, both ET and FANG seem to have a slight edge over SM in terms of bullish indicators. However, individual investment goals, risk tolerance, and market conditions should always be factored in before making a decision. As always, diversifying investments and continuous monitoring are key to navigating the dynamic energy market.
Diversification and Risk Management:
In the volatile world of energy stocks, diversification remains a cornerstone strategy for risk mitigation. While ET, FANG, and SM each offer promising prospects, they cater to different segments of the energy sector.
ET, with its stronghold in the Oil & Gas Pipelines industry, provides a unique proposition. Pipelines tend to have more stable revenue streams, often backed by long-term contracts, making them less susceptible to short-term oil price fluctuations. This stability can be a boon for investors seeking consistent returns.
FANG and SM, being part of the Oil & Gas Production industry, are more directly influenced by global oil prices, production levels, and geopolitical events. While this can lead to higher volatility, it also offers the potential for significant gains during bullish oil markets.
Global Energy Dynamics:
The global energy landscape is undergoing a transformation. With increasing emphasis on renewable energy and sustainability, traditional oil and gas companies are diversifying their portfolios. Investors should keep an eye on how ET, FANG, and SM adapt to these changing dynamics. Their investments in research, exploration of alternative energy sources, and strategic partnerships will play a pivotal role in their future growth.
Investing in the energy sector requires a keen understanding of both macroeconomic factors and company-specific fundamentals. While ET offers stability, FANG and SM provide the allure of potentially higher returns, albeit with increased volatility.
It's essential to balance one's portfolio based on individual financial goals and risk appetite. For those looking for a mix of stability and growth, a diversified investment across ET, FANG, and SM might be a prudent approach.
The energy sector, with its complexities and opportunities, remains a fascinating space for investors. Continuous research, staying updated with global trends, and periodic portfolio rebalancing are crucial to harnessing its potential.
Aroon Indicator for SM shows an upward move is likely
SM's Aroon Indicator triggered a bullish signal on October 16, 2024. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 294 similar instances where the Aroon Indicator showed a similar pattern. In of the 294 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. of 67 cases where SM's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SM advanced for three days, in of 318 cases, the price rose further within the following month. The odds of a continued upward trend are .
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on October 17, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on SM as a result. In of 99 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for SM turned negative on October 18, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 48 similar instances when the indicator turned negative. In of the 48 cases the stock turned lower in the days that followed. This puts the odds of success at .
SM moved below its 50-day moving average on October 28, 2024 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for SM crossed bearishly below the 50-day moving average on October 28, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SM declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
SM broke above its upper Bollinger Band on October 03, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 75, placing this stock better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.619) is normal, around the industry mean (5.175). P/E Ratio (7.373) is within average values for comparable stocks, (19.495). Projected Growth (PEG Ratio) (0.660) is also within normal values, averaging (5.525). Dividend Yield (0.013) settles around the average of (0.085) among similar stocks. P/S Ratio (2.552) is also within normal values, averaging (153.585).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. SM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
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Industry description
Market Cap
High and low price notable news
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Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a developer of natural gas and crude oil properties
Industry OilGasProduction