We’ve done exceedingly well in 2016 trading oil stocks – but as we move to 2017, we need to take a look at where to concentrate our focus to continue the strong performance. While we’ve had several opportunities to take advantage of dips in oil prices to get quality oil E+P’s at bargain prices in the last year, those bargains are no longer around – many of our most favored stocks are well priced and not to be bought today.
So to start 2017, as with all my trades, I want to look for VALUE – where the rest of the investing world has left an opportunity underappreciated or entirely overlooked. And here, I see two good ones: liquid natural gas and coal.
Coal stocks have been off of my radar for almost a decade. In the end, coal is a dying energy source, and will never re-attain the importance to the U.S. electricity grid and industrial growth it once had. Many of coal’s strongest companies have been forced into bankruptcy restructuring in the last two years. Still, the Trump campaign was fierce in its support of coal miners and can do quite a bit to re-enliven coal production, at least in the short term of the next several years.
First and foremost, he has the power to roll back much of the EPA regulatory structure that turned the power industry away from coal. His pick for EPA commissioner is Scott Pruitt, the Attorney General from the oil rich state of Oklahoma. Like the President-elect, he is a climate change ‘dissenter’…