Two Oil Stocks Ride the Trump Wave to New Highs
Friday, Nov 15, 2024 1:50 pm ET
4min read As the market pulls back post-election, some oil stocks remain resilient. Enterprise Products Partners (EPD) and Riley Exploration Permian (REPX) have reached new highs, benefiting from Donald Trump's perceived petroleum production-friendly stance. Trump's "drill, baby, drill" campaign slogan and plans to increase oil production could boost these energy plays.
EPD, a transportation and storage services provider, has climbed around 1.1% in heavier-than-average volume. The stock is in a 5% buy zone up to $31.55, having broken out of a flat base with a 30.05 buy point. EPD's nine-year highs and strong fundamentals, with third-quarter profit up 8% and revenue up 15%, make it an attractive investment.
REPX, an exploration and production company, reversed lower about 0.7% after reaching highs. Despite retracing below the entry, the stock has climbed around 25% since Nov. 5. REPX's IBD Relative Strength Rating rose to 88 from 35 four weeks ago, indicating strong performance. Although trading thinly, REPX's 93 Composite Rating and fourth-quarter earnings growth estimates of 123% signal potential.
Both stocks' current valuations and fundamentals align well with the potential impacts of Trump's energy policies. As Trump aims to increase domestic oil production and implement higher tariffs, these oil stocks could continue to benefit, making them attractive investments in a balanced portfolio.
Trump's energy policies, characterized by his "drill, baby, drill" stance, could significantly influence oil and gas demand. His proposed increase in domestic production, use of emergency powers for new projects, and support for higher tariffs on imported oil could lead to a surge in U.S. oil supply. This increased supply, combined with a weak global demand outlook due to factors like China's slowing economy, could weigh on oil prices in the short term. However, in the long run, a more production-friendly administration could boost the prospects of oil stocks like EPD and REPX, which have already shown strength post-election.
In conclusion, EPD and REPX offer attractive investment opportunities in the energy sector, given their strong fundamentals and the potential benefits from Trump's energy policies. As the market continues to evolve, investors should monitor these stocks and the broader energy landscape to capitalize on potential growth opportunities.
EPD, a transportation and storage services provider, has climbed around 1.1% in heavier-than-average volume. The stock is in a 5% buy zone up to $31.55, having broken out of a flat base with a 30.05 buy point. EPD's nine-year highs and strong fundamentals, with third-quarter profit up 8% and revenue up 15%, make it an attractive investment.
REPX, an exploration and production company, reversed lower about 0.7% after reaching highs. Despite retracing below the entry, the stock has climbed around 25% since Nov. 5. REPX's IBD Relative Strength Rating rose to 88 from 35 four weeks ago, indicating strong performance. Although trading thinly, REPX's 93 Composite Rating and fourth-quarter earnings growth estimates of 123% signal potential.
Both stocks' current valuations and fundamentals align well with the potential impacts of Trump's energy policies. As Trump aims to increase domestic oil production and implement higher tariffs, these oil stocks could continue to benefit, making them attractive investments in a balanced portfolio.
Trump's energy policies, characterized by his "drill, baby, drill" stance, could significantly influence oil and gas demand. His proposed increase in domestic production, use of emergency powers for new projects, and support for higher tariffs on imported oil could lead to a surge in U.S. oil supply. This increased supply, combined with a weak global demand outlook due to factors like China's slowing economy, could weigh on oil prices in the short term. However, in the long run, a more production-friendly administration could boost the prospects of oil stocks like EPD and REPX, which have already shown strength post-election.
In conclusion, EPD and REPX offer attractive investment opportunities in the energy sector, given their strong fundamentals and the potential benefits from Trump's energy policies. As the market continues to evolve, investors should monitor these stocks and the broader energy landscape to capitalize on potential growth opportunities.
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