The energy sector is a vast and ever-evolving industry, with companies focusing on finding new sources of oil and natural gas, extracting and processing resources, and supplying them to the economy. Investing in energy stocks can be rewarding, but it's important to understand that they are some of the most volatile and prone to bankruptcy. The global transition from fossil fuels to renewable energy offers investors the opportunity to invest in emerging energy companies seeking to participate in a huge market. Here are our top seven picks for the best energy sources to invest in.
Brookfield Renewableis a leading global producer of renewable energy.
It operates hydroelectric, solar, wind and energy transition assets. The company sells the energy produced by the assets under long-term fixed-rate power purchase agreements (PPAs) to electricity companies and other large energy users. This balance makes it an ideal option for investors looking for a way to invest in the energy transition from fossil fuels to cleaner alternatives.
ConocoPhillipsis a diversified oil and natural gas producer. It has operations around the world and uses various methods to produce oil and natural gas.
Overall, Chevron aims to provide the fuels for today's economy while moving toward the low-carbon fuels it will need in the future.
NextEra Energyis one of the largest electricity companies in the country. It is also a world leader in the production of energy from wind and sun through its energy resources segment, which sells clean energy to other utility companies and end users across the country. NextEra Energy has one of the best financial profiles in the electrical services sector, with one of the highest credit ratings in its peer group. It also has a conservative dividend payment ratio for a utility company, allowing it to pay a stable and growing dividend.
The company expects to increase its payment at an annual rate of 10% by 2024, making it an excellent renewable energy dividend stock.
TC Energyis one of the largest operators of natural gas pipelines in North America. It has natural gas pipelines in the U. S. UU.
In addition, the company has a first-class liquid pipeline system, making it one of Canada's leading oil exporters. It is also one of the largest energy producers in the country and focuses on nuclear energy and renewable energy. The company's energy infrastructure assets generate relatively stable cash flows backed by contracts based on fees and regulated rates. This low-risk business model has proven to be very durable, as TC Energy generates constant cash flow in all market environments to support its dividends and expansion.
TORM PLC (TRMD)and Teekay Tankers Ltd.
TNK, with an increase of 12% and 52% this year this year, respectively, have performed especially well, thanks to some of the highest oil tanker rates ever recorded. In addition, companies such as PBF Energy (PBF) have risen by 13% to date, as they close the first quarter with a much healthier balance sheet thanks to the rise in the price of oil last year.