These energy stocks could see further upside from stronger demand, investor Jay Peters says
It’s time to take a look at some energy stocks that are attractively valued, according to Jay Peters, portfolio manager at NewEdge Wealth. The investor joined CNBC’s “Power Lunch” on Thursday to discuss his view of two energy stocks and a semiconductor company, saying they stand out as buying opportunities. Here’s what he had to say. APA Corp. APA, formerly Apache, stands out as a quality oil and gas exploration company, Peters said. “Apache stands out as a company that’s been incredibly operationally efficient, able to raise their production while cutting their costs,” he said. “And, from a fundamental standpoint, is a company that trades at eight times earnings, with a 20% free cash flow yield, really diversified production base, not only here in the Permian, but also with assets in the North Sea and in North Africa.” “That could be a long term call option, as we were talking about, and ultimately, in our view, which is a high quality producer,” he said. Peters’ view breaks from consensus hold rating from the Street. APA shares underperformed this year, up just 2%. It’s up more than 8% Thursday after the company posted better-than-expected earnings results. EOG Resources EOG Resources is a high quality operator that could see stronger demand, especially given power demands from data centers used to provide artificial intelligence, Peters said. The stock is down more than 14% this year. It’s a consensus buy on Wall Street ahead of its earnings results set to be released after the close Thursday. “EOG is another company with great operational efficiency, capital discipline, really minimal debt,” Peters said. “So a lot of things to like if you’re looking for quality in this segment.” Qualcomm Qualcomm is a stock that Peters is adding to in his portfolio. The semiconductor stock is up 24% in six months, but the business is one that can grow thanks to expanding demand for wireless connectivity, the investor said. “It’s a name that we continue to be intrigued by,” he said. “This is a business undergoing a kind of a multi-year transition. And we’re more encouraged about the growth that they’re seeing in in these long-term secular growth opportunities of things like automotive and connected devices and Internet of Things,” he added. “And, Qualcomm, you know, it is one of those cheapest semiconductor companies in the market.”
Source – CNBC
