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I too like energy as an investment theme but I don't feel comfortable holding the oil and natural gas producing companies. I think we have a glut of natural gas at the moment which is going to take considerable time before it translates into meaningful price appreciation and the fate of both oil and NG companies is too tied to the price of a barrel or cubic foot to suit my tastes. Having said all that, the pipeline companies which transport these goodies just sit around collecting a toll no matter what the barrel and cubic foot prices might be and pass my share on to me. It's a beautiful thing.
I like the infrastructure companies, although particularly Transcanada (TRP), Enbridge (ENB) and Kinder Morgan (KMI) - if there is going to be considerable energy found, there's going to be a need to move it efficiently. In the meantime, all three (as well as their spin-offs) offer significant yields. Additionally, I like these companies for the hard/productive/strategic assets and the high degree of difficulty for someone to come in and compete/replicate. Infrastructure and "infrastructure-related" has become a significant portion of my holdings.
Some of the rails - such as Canadian Pacific (CP) will likely continue to do well due to energy exploration, as well.
I continue to think Canadian oil co's are cheap - there was the CNOOC/Nexen deal approved recently and I think there will be others. Companies like Canadian Natural Resources (CNQ) and Canadian Oil Sands (COSWF) continue to trade (especially COSWF) not that far from their 2009 lows.
I have some CNDA, its getting cheaper, down 10% in the past year.
Bee, I like the energy sector also, when I bought in in 2008/09 I thought we would see a significant rebound in world energy use by now. I hold IXC, CNDA and XME. Interestingly the active funds I own are underweight energy.
Comments
Some of the rails - such as Canadian Pacific (CP) will likely continue to do well due to energy exploration, as well.
I continue to think Canadian oil co's are cheap - there was the CNOOC/Nexen deal approved recently and I think there will be others. Companies like Canadian Natural Resources (CNQ) and Canadian Oil Sands (COSWF) continue to trade (especially COSWF) not that far from their 2009 lows.
Bee,
I like the energy sector also, when I bought in in 2008/09 I thought we would see a significant rebound in world energy use by now. I hold IXC, CNDA and XME. Interestingly the active funds I own are underweight energy.