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“Oil Be Right Back,” Says Crude Prices

Daniel Chase

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We talk quite a bit about the power of social media but when it comes to President Trump’s affinity for tweeting (TWTR), the influential nature of social platforms is taken to an entirely different level. The president may tweet support for a Republican candidate running for Congress, or send his thoughts and prayers to victims of yet another mass shooting, and every tweet he shares, like clockwork, becomes a national headline as soon as a member of the media gets a notification on their smartphone. 

“Trump tweets as if he has a joystick and he has everything under his command like he is playing one of these video games.”

Tom Kloza, Global Head of Energy Analysis, Oil Price Information Service 

Over the course of the last month, the price of crude oil has dropped 25%, with the cost of gasoline sinking to as little as $2 a gallon in a few states. According to the US Energy Information Administration (EIA), the United States has “surpassed Russia and Saudi Arabia to become the world’s largest crude oil producer earlier this year,” making President Trump so very happy. In fact, to express his pleasure with the news on oil prices, Trump shockingly took to Twitter (TWTR) to share his feelings:

“Oil prices getting lower. Great! Like a big Tax Cut for America and the World. Enjoy! $54, was just $82. Thank you to Saudi Arabia, but let’s get lower.”

President Donald Trump on Twitter

Let’s unpack that tweet for a minute, shall we? First of all, oil is currently trading around $50 barrel, which is the cheapest crude has been in over a year, specifically since October 4, 2017, when the price dropped just below the $50 threshold. When the price per barrel of crude drops, consumers enjoy a nice discount at the gas pump, but for all other stakeholders in the oil industry, price dives like this bring up imminent fears of a bear market.

 Before he even took office, President Trump made it clear that he wanted every product, service, and commodity to be manufactured in America and only America. As it relates to the oil industry, this has translated to a rush to pump oil out of shale fields around the country, most notably in West Texas, miraculously leading to record-high levels of production for black gold. Though domestic oil production couldn’t be higher, concerns about oversupply have sent oil prices every which way but loose. 

Clifford Krauss, a contributor to the New York Times, writes that oil is currently resting on an economic sweet spot, given that prices are not so high that consumers and businesses feel pressed for cash, and not so low as to disrupt business for engird companies and oil exporters like Saudi Arabia and Russia. Since President Trump insisted the US focus more domestic crude, oil production has more than doubled in the last ten years, to over 11 million barrels per day. The recent drop in oil prices has not only raised concerns for investors in the space,  but for manufacturers and the hundreds of thousands of oil workers that fear for their jobs. According to the New York Times, the last time oil prices slid in 2014, “more than 160,000 oil workers lost their jobs.” Think about it. If oil prices decrease, so too does the profit enjoyed by oil producers because a decrease in cost, coupled with overstock, will result in less demand, and therefore, less of a need for oil workers. 

Investors in crude are hoping that oil prices will shoot back up after nations discuss the state of the oil industry at the G20 summit this weekend, specifically praying that Russian President Vladimir Putin and Saudi Arabian Crown Prince Mohammed bin Salman will come to an agreement, but Putin told several media sources on Thursday that the recent drop in oil prices bares no effect on him or his country, whatsoever. 

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Energy

Enphase Energy (ENPH) Is The Stock Of The Year: Is It Time To Sell?

A. Lawrence

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Enphase Energy Inc. (ENPH Stock Report) is poised for a promising future since it provides basic technology in the development of a final product in the solar panel industry. With the energy industry shifting into renewable energy there is much potential to leverage.

Therefore investors should be keen on Enphase stock because of the potential presented but they have to consider the following factors before making a decision to buy:

Enphase Stock Price Skyrockets On Big Catalysts

The company produces micro-inverters which are very crucial in the solar panel industry. There is huge potential in the market and according to the US Energy Information   Administration, the solar industry is expected to grow by around 50% by 2050 and lead the rest of renewable energy sources.

ENPH stock price

After hitting a wall in 2016 because of operational discipline and lack of finances the company has turned a leaf by having a new CEO as well as reviewing the production and sales strategy. It had a strong 2018 with revenue increasing by 10% and adjusted earnings of $0.10 per share. The trend continued to 2019 and the company saw a 100% growth in adjusted earnings in Q1.

Performance of Enphase Stock Price

Enphase’s stock price has been performing well. So far it’s up over 460% since the beginning of this year. For investors, they have to assess the risk-reward balance of the stock. Also the possibility of Wall Street getting ahead of itself.

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In terms of valuation, you can’t use price-to-earnings as your guide. That’s because the company has been profitable. This leaves them not so promising price-to-sales as a valuation metric.

Enphase Energy might have turned a new leaf. It’s expected to have a strong 2019 if the performance in Q1 is anything to go by. However, ENPH stock is already showing overbought technical indicators.

This, of course may be worrying considering this upturn happened in a short span. There is so much hype regarding the stock without focusing on underling numbers. As an investor, would you rather sit and watch the stock or jump in at all time highs? The choice is yours.

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Energy

Oil Stock Prices Soar: Is Crude Oil Back In The Bull Trend

Jon Phillip

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On Tuesday, the prices of some of the better known offshore oil drilling stocks soared and some of the stocks managed to gain as much as 10%. Some of the biggest gainers in the sector included Transocean, Diamond Offshore Drilling (DO Stock Report), Transocean Ltd (RIG Stock Report) and Noble Corporation (NE Stock Report).

There are some factors which are responsible for the rise in these stocks. One of those is the improved outlook among investors about the economy, while the other factor is related to Transocean’s financial results, which managed to beat analysts’ estimates comfortably.

Oil Prices Jump 2%

The rise in oil prices usual has a big effect on offshore oil drilling stocks. On Tuesday, the price of oil rose by a hefty 2%. Oil traders across the world now have a positive outlook about oil prices since the Federal Reserve cut rates. That is almost certainly going to turbocharge economic activities.


[Report] Oil Isn’t The Only Thing That Could Get A Boost From This Fed Decision


Consequently, oil demand is going to rise and the price of oil could rise further. Oil producers are going to spend more on drilling activities on the back of better margins. With higher demand, it’s only natural that offshore drilling companies’ shares have gone up.

Major Trigger For A True Bull Market?

On the other hand, the better than expected results posted by Transocean also proved to be a major trigger. Analysts believe that the company could do even better in the upcoming quarters. That has created optimism about the wider offshore drilling industry.

Analysts now believe good times might be approaching for some of the main offshore oil drilling companies. This could result from the rate cut by the Federal Reserve and the expected rise in oil prices, . However, oil prices can be extremely fickle. Therefore many other factors could end up affecting prices negatively.


Like This Article? Check Out: Gold Prices Have Investors Scrambling & Analysts Clamoring For Junior Gold Stocks


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Energy

Solar Energy Stock Prices See Brighter Future

Joe Samuel

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solar energy stocks

The future for solar energy plants and industry looks bright (no pun intended). Even after the government’s inclination towards fossil fuels and the high tariff rates levied, Q1 of 2019 saw a 10% rise in the installation digits to 2,674 megawatts of Solar.

A report- Solar Market Insight Report 2019 Q2 – was published by SEIA and Wood Mackenzie Power & Renewables. It shows how solar power has set a record for itself, strengthening the residential and utility-scale projects. States have been actively installing solar; take, for instance, Florida, which installed the biggest percentage of solar in Q1.


Special Report | It’s Not Solar But Two Massive Growth Industries May Give One Choice for Investors


NextEra Energy (NEE – Stock Info)’s subsidiary, Florida Power and Light was one of the major reasons for this high installation rate. This happened after the announcement of procurement of 1,500 MW of solar. The company plans to expand this installation number to 10,000 MW by 2030. This implies a new market development possibility.

The Increasing Sales Figure Might Set Another Record

On the other hand, California used to lead for solar installations, but it reported a 538 MW installation figure in Q1. While in 2017 and 2018, California had accounted for 2,599 MW and 3,396 MW solar installations respectively, Florida had installed a total of 758 MW in 2017 and 857 MW in 2018.

Thus, the sudden boost in the Floridian install came as a pleasant surprise but the residential and commercial solar is yet to show such progress in Florida. With the solar leasing being pushed to next year and the push back on net metering by utilities, Florida still has a long way to go.

Residential solar installation alone rose by 6% as compared to the previous years’ figures. A total of 603 MW of solar was installed in Q1. This helped companies like Sunrun (RUN – Stock Info) and Vivint Solar (VSLR – Stock Info) make it through its difficult conditions. Utility Solar, on the other hand, with installation count of 1,633 MW, is also skyrocketing.

TAN stock Solar ETF stock price

Florida seems to have been a significant contributor to this figure. The boom in utility-solar has changed the projected installations for the state. This went from 6,000 MW to 9,000 MW expected over the next five years. Meanwhile, nationwide the forecasted figure increased by 1,200 MW in 2019.

What Does The Future Hold?

The sales and marketing cost have been high and been one of the major roadblocks in the industry’s growth. The commercial solar, however, remains a major concern. With the policy changes in California, Minnesota, and Massachusetts affecting the industry, the installation of solar decreased by 18%. This total was only 438 MW.

The increased demand for solar is a benefit for the companies. Solar-panel provider giants like First Solar (FSLR – Stock Info) and SunPower (SPWR – Stock Info) could greatly benefit. The companies look forward to an enthusiastic surge in demand. Even companies like Sunrun, Vivint Solar and SunPower have gained with the growing volumes of residential installing solar.

After two hard years of policy headwinds, this came as a hopeful rescue for the companies. The higher volumes promise a better future for the stocks of the companies.

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