In this piece, we will take a look at ten best performing energy stocks in 2024.
The energy sector is poised for significant transformation in 2024, driven by a blend of evolving market dynamics, fluctuating commodity prices, and the growing influence of renewable energy sources. As we move deeper into the year, critical indicators reflect a landscape of opportunity and challenge for investors. Notably, Brent crude oil prices are projected to stabilize around $82 per barrel, a modest increase from $81 in 2023, signaling a return to pre-pandemic levels. Despite some volatility, market analysts expect that strategic production cuts by OPEC+ will sustain this upward trajectory, underscoring the intricate balance between supply and demand that will shape oil markets.
In tandem with oil prices, retail gasoline costs are forecasted to dip slightly, with an average price of $3.30 per gallon expected in both 2024 and 2025. This decrease, coupled with a projected increase in U.S. crude oil production from 12.9 million barrels per day in 2023 to 13.3 million in 2024, indicates a robust domestic supply environment. Moreover, the U.S. liquefied natural gas (LNG) sector is anticipated to grow, with gross exports expected to rise from 12 billion cubic feet per day in 2023 to 14 billion in 2025, highlighting the country’s role as a key player in global energy markets.
Natural gas, another crucial component of the energy portfolio, is also set for price fluctuations. The forecast indicates that prices at Henry Hub will remain relatively stable at around $2.20 per million British thermal units (MMBtu) before spiking to approximately $3.10/MMBtu in 2025. This trend reflects a complex interplay between production capabilities and increasing export demands, especially as the U.S. continues to expand its LNG footprint. Additionally, biomass-based diesel products are gaining traction, now accounting for 9% of total distillate fuel consumption, indicating a shift toward more sustainable fuel sources amidst rising environmental concerns.
Electricity generation in the U.S. is also undergoing a transformative phase, with significant contributions from renewable sources. Natural gas remains the dominant player, accounting for 42% of electricity generation, but renewables are gaining ground, rising from 21% in 2023 to a projected 25% in 2025. Solar energy, in particular, is experiencing explosive growth, driven by enhanced capacity and technological advancements. The first half of 2024 saw solar energy contribute to 59% of new generating capacity additions, primarily fueled by developments in battery storage technologies. States like Texas and California are expected to lead in solar generation, reflecting a broader trend toward green energy adoption.
These shifts in the energy landscape are underpinned by a steady economic backdrop, with the U.S. GDP projected to grow by 2.6% in 2024. However, it’s important to note that CO2 emissions are expected to hold steady at 4.8 billion metric tons, illustrating the ongoing challenge of balancing energy production with environmental stewardship. As the world grapples with climate change, energy companies are increasingly under pressure to innovate and transition to more sustainable practices.
Investors in energy stocks must navigate this evolving environment carefully. The interplay between traditional fossil fuels and renewable energy sources creates a unique set of investment opportunities and risks. While oil and gas companies are expected to benefit from higher prices and increased demand, those heavily invested in renewables may see significant growth as the transition to a low-carbon economy accelerates.
Recent geopolitical tensions, such as political instability in Libya, further complicate the picture. These events can lead to production outages, affecting global oil supply and prices. Despite these uncertainties, the fundamentals of the energy sector indicate promising opportunities for discerning investors. Ongoing production cuts from OPEC+ and strong demand from non-OECD countries signal a likely increase in oil consumption, further enhancing the attractiveness of energy stocks.
As we delve into the ten best-performing energy stocks for 2024, it’s crucial to consider these macroeconomic factors and industry trends. From traditional oil and gas giants to innovative renewable energy firms, the companies featured in this analysis are well-positioned to thrive amidst the changing landscape. Each stock represents a unique opportunity to capitalize on the anticipated shifts in energy consumption, production, and pricing, making them worthy of consideration for any forward-thinking investment portfolio.
In summary, the energy sector in 2024 is characterized by a blend of traditional and renewable energy sources, supported by favorable economic conditions and strategic industry developments. As we explore the ten best-performing energy stocks, we’ll analyze how these companies are adapting to the evolving landscape and positioning themselves for success in a rapidly changing world. The data and insights referenced here are sourced from the U.S. Energy Information Administration (EIA).
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Our Methodology
For this article, to make our list of the best performing energy stocks in 2024, we ranked all publicly traded energy companies by their year to date share price performance as of September 25 and picked out the top 10 firms. The stocks are ranked in ascending order of their year-to-date performance.
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10. Viper Energy, Inc. (NASDAQ:VNOM)
Year to date Share Price Gain: 55.19%
Number of Hedge Fund Holders: 26
Viper Energy, Inc. (NASDAQ:VNOM) is recognized as one of the best-performing energy stocks of 2024, with a year-to-date share price gain of 55.19%. This strong performance can be attributed to the company’s robust financial fundamentals and operational efficiency, which have been key drivers of its sustained growth. The company’s strategic approach to production, capital allocation, and shareholder returns sets it apart in the energy sector, making it a top contender in the list of high-performing stocks.
During the second quarter of 2024, Viper Energy, Inc. (NASDAQ:VNOM) demonstrated remarkable operational and financial performance. Oil production increased by 4% compared to the previous quarter, while cash available for distribution rose by nearly 9%, signaling strong production efficiency and cash flow generation. The company’s focus on large-scale development projects, particularly through its high-concentration royalty acreage with Diamondback Energy, continues to pay off. Moreover, the company’s decision to increase its annual base dividend by 11% showcases its confidence in sustaining and growing shareholder returns, even in a fluctuating market environment.
Viper Energy, Inc. (NASDAQ:VNOM) cash margins and free cash flow conversion rate, which remains around 80%, underline the company’s ability to generate strong cash flow from its operations. Furthermore, the 14% growth in oil production per share over the past year emphasizes the company’s commitment to expanding its operational base while maintaining efficiency.
From a strategic standpoint, Viper Energy, Inc. (NASDAQ:VNOM) conversion to a Delaware corporation has significantly broadened its investor base, providing additional governance rights and increasing its visibility in the market. The company has been added to notable indices such as the Russell 1000, improving its liquidity and overall investor confidence.
With a breakeven price of below $30 WTI, Viper Energy, Inc. (NASDAQ:VNOM) has positioned itself as one of the most resilient players in the energy sector, capable of weathering price fluctuations while continuing to deliver value to shareholders. This strong financial footing, combined with a clear focus on operational growth and capital discipline, makes Viper Energy, Inc. (NASDAQ:VNOM) a top performer in the energy space for 2024.
Carillon Eagle Small Cap Growth Fund stated the following regarding Viper Energy, Inc. (NASDAQ:VNOM) in its first quarter 2024 investor letter:
“Viper Energy, Inc. (NASDAQ:VNOM) owns and acquires mineral and royalty interests in oil and natural gas properties primarily in the Permian Basin of West Texas and eastern New Mexico. The stock has had a solid run recently as it has benefitted both from the recent upward move in crude oil and from a recent sizable acquisition made by the company’s exploration and production parent. The company being acquired possesses a notable minerals portfolio, which has investors excited for the potential dropdown transaction opportunity for Viper.”
09. CNX Resources Corporation (NYSE:CNX)
Year to date Share Price Gain: 57.50%
Number of Hedge Fund Holders: 29
CNX Resources Corporation (NYSE:CNX), a key player in the natural gas industry, has shown remarkable performance in 2024, making it one of the best-performing energy stocks this year. With a year-to-date share price gain of 57.50%, CNX Resources Corporation (NYSE:CNX) has consistently outperformed its peers, driven by strong financial results and a diversified operational footprint in the Appalachian Basin. The company’s robust fundamentals, including its efficient natural gas extraction and processing capabilities, make it a compelling choice for energy investors seeking growth.
CNX Resources Corporation (NYSE:CNX) reported a significant earnings beat in Q2 2024, with earnings per share (EPS) of $0.36, surpassing analysts’ expectations of $0.27. This performance was supported by its strong natural gas production, particularly in its Shale and Coalbed Methane (CBM) segments. The company produced 4.5 billion cubic feet (Bcf) of natural gas in Q2, keeping in line with its full-year guidance of 15-18 Bcf, indicating a stable production outlook for the rest of the year.
The company’s ability to consistently generate free cash flow, estimated at $75 million for 2024, is a key financial strength. CNX Resources Corporation (NYSE:CNX) focus on cost efficiency, particularly in its deep Utica wells, has ensured that operational costs remain in line with expectations, further bolstering its bottom line. Moreover, its investments in water sourcing and handling services have started yielding positive results, contributing an additional revenue stream from third-party contracts.
On the technology front, CNX Resources Corporation (NYSE:CNX) innovative solutions like the AutoSep technology, which enhances oil and gas production while reducing costs and emissions, have the potential to drive future growth. The company’s compressed natural gas (CNG) initiative also opens new avenues for industrial and power generation applications, providing further opportunities for revenue diversification.
In summary, CNX Resources Corporation (NYSE:CNX) strong financial performance, focus on operational efficiency, and technological innovation position it as a top choice among energy stocks in 2024. Its consistent production and cash flow generation make it an attractive investment in the energy sector.
Longleaf Partners Fund stated the following regarding CNX Resources Corporation (NYSE:CNX) in its first quarter 2024 investor letter:
“CNX Resources Corporation (NYSE:CNX) – Natural gas company CNX Resources was another top performer in the quarter. It has been a tough natural gas price environment over the last several months, but CNX came into this year more hedged than peers and with a strong balance sheet that has funded continued share repurchase at a double-digit annualized pace. The company is also executing well operationally. Our partners CEO Nick DeIuliis and Chairman Will Thorndike continue focusing on growing long term FCF and value per share. The quarter saw EQT, a larger competitor in the Appalachian basin, decide to recombine its pipeline business with its upstream business. CNX had already done this in 2020 at what we believe was a better time and a better price, so it was nice to see additional validation of this decision. CNX remains very discounted and one of our stronger value growers over the last few years, which is why we added to our position earlier in the quarter when it was trading at a larger discount.”
08. Greenfire Resources Ltd. (NYSE:GFR)
Year to date Share Price Gain: 57.61%
Number of Hedge Fund Holders: 12
Greenfire Resources Ltd. (NYSE:GFR) stands out as one of the best-performing energy stocks in 2024, boasting a year-to-date share price gain of 57.61%. The company’s strategic focus on oil and gas development in the Athabasca oil sands region of Alberta, combined with its innovative use of Steam-Assisted Gravity Drainage (SAGD) technology, sets it apart as a leader in the sector. Greenfire Resources Ltd. (NYSE:GFR) assets, including a 75% working interest in the Hangingstone Expansion Facility and a 100% working interest in the Hangingstone Demonstration Facility, further highlight its strong production capabilities.
Despite facing operational delays due to wildfires and equipment failures, Greenfire Resources Ltd. (NYSE:GFR) fundamentals remain strong. In Q2 2024, the company delivered consolidated bitumen production of 18,993 barrels per day, a slight increase from 18,036 barrels per day in Q2 2023. More impressively, Greenfire generated adjusted EBITDA of CAD $58.4 million, marking a 70% year-over-year increase, and adjusted funds flow surged by 100% to CAD $47.2 million.
These strong financial results were achieved even with disruptions, highlighting Greenfire’s resilience and effective operational management. The company’s disciplined approach to capital allocation was evident as it invested CAD $23.0 million into property, plant, and equipment, with 90% allocated to drilling. This investment should support further production growth, especially as Greenfire Resources Ltd. (NYSE:GFR) expects production at the Hangingstone Facilities to increase by 13-19% in 2024.
Greenfire Resources Ltd. (NYSE:GFR) is also committed to reducing its debt. The company redeemed US$61 million of its US$300 million Senior Secured Notes due in 2028, emphasizing its focus on maintaining financial stability. With $1.8 billion in corporate tax pools, low pre-payout royalty rates, and no overriding royalty obligations, Greenfire Resources Ltd. (NYSE:GFR) is well-positioned for future free cash flow generation, particularly as the Trans Mountain Expansion pipeline is expected to enhance crude oil transportation and improve pricing for the company’s products. In summary, Greenfire Resources Ltd. (NYSE:GFR) strong financial metrics, operational resilience, and strategic focus on debt reduction and production growth make it a top-performing energy stock in 2024, with substantial upside potential moving forward.
07. Vista Energy, S.A.B. de C.V. (NYSE:VIST)
Year to date Share Price Gain: 69.33%
Number of Hedge Fund Holders: 18
Vista Energy, S.A.B. de C.V. (NYSE:VIST) has been one of the best-performing energy stocks in 2024, achieving a remarkable year-to-date share price gain of 69.33%. This strong performance can be attributed to the company’s robust fundamentals, impressive production growth, and efficient cost management. Vista Energy is well-positioned in the energy sector with a focus on the exploration and production of oil and gas across Latin America, particularly in Argentina’s Neuquina Basin and the highly productive Vaca Muerta region. The company’s solid financials and operational metrics make it a compelling choice for energy investors.
In the second quarter of 2024, Vista Energy, S.A.B. de C.V. (NYSE:VIST) total production soared to 65,300 barrels of oil equivalent per day (BOE/d), marking a 40% year-over-year increase. Oil production specifically rose by an impressive 46%, with the company producing 57,200 barrels of oil per day. These significant gains were fueled by the tie-in of 48 new wells over the past year, contributing to higher production levels and ensuring future growth potential.
Financially, Vista Energy’s performance was equally strong. The company’s revenues reached $397 million in Q2, representing a 66% increase compared to the same period in 2023. This revenue growth was bolstered by rising oil prices and higher production volumes. The company maintained a disciplined cost structure, with a lifting cost of $4.5 per BOE, reflecting a 6% year-over-year reduction. This focus on cost efficiency, coupled with strong revenue growth, drove Vista Energy’s adjusted EBITDA to $288 million, a 90% increase year-over-year, with an EBITDA margin of 70%.
Vista Energy, S.A.B. de C.V. (NYSE:VIST) robust balance sheet is another highlight, with a net leverage ratio of 0.56x adjusted EBITDA, indicating the company’s prudent financial management. Free cash flow reached $8 million, despite increased capital expenditures driven by well completions and infrastructure projects. With its strong operational performance, expanding production capacity, and efficient cost management, Vista Energy, S.A.B. de C.V. (NYSE:VIST) remains a top contender in the energy sector, positioning itself for continued success in the coming quarters.
06. Solaris Energy Infrastructure, Inc. (NYSE:SEI)
Year to date Share Price Gain: 76.26%
Number of Hedge Fund Holders: 21
Solaris Energy Infrastructure, Inc. (NYSE:SEI) has positioned itself as a leader in the oilfield services industry with its innovative solutions for oil and gas operators. The company designs and manufactures specialized equipment that supports critical operations such as proppant and fluid management, mobilization, and logistics services, helping oil and gas operators improve their efficiency. Its offerings have made Solaris a standout performer in a highly competitive industry. In 2024, Solaris Energy Infrastructure, Inc. (NYSE:SEI) has been one of the best-performing energy stocks, with an impressive year-to-date share price gain of 76.26%.
In the second quarter of 2024, Solaris Energy Infrastructure, Inc. (NYSE:SEI) reported exceptional results, showcasing its strong financial fundamentals. The company achieved total revenue of $82 million, driven by increased demand for its proppant management and last-mile logistics systems. This represents a year-over-year increase of 15%, reflecting the growing reliance of energy operators on Solaris’ technology to optimize their operations. The company’s adjusted EBITDA also surged to $42 million, a 20% increase compared to the same period last year, underscoring the scalability of its business model and operational efficiencies.
A key factor in Solaris Energy Infrastructure, Inc. (NYSE:SEI) success has been its ability to control costs while expanding its product offerings. The company’s gross margins improved to 51%, signaling strong profitability even in a volatile market environment. Solaris’ strategic acquisition of Mobile Energy Rentals LLC further enhances its capabilities in all-electric equipment and energy storage, enabling it to offer more comprehensive solutions to its clients in the oil and gas industry.
Additionally, Solaris Energy Infrastructure, Inc. (NYSE:SEI) balance sheet remains strong, with a net cash position and minimal debt. This financial flexibility allows the company to continue investing in growth initiatives, such as expanding its Railtronix software and developing new technologies for well site automation. Solaris Energy Infrastructure, Inc. (NYSE:SEI) is well-positioned to capitalize on the ongoing recovery in energy markets, making it a top contender among the best-performing energy stocks in 2024. With its robust financial metrics, strategic acquisitions, and continued innovation, Solaris Oilfield Infrastructure is poised for sustained growth in the years ahead.
05. Targa Resources Corp. (NYSE:TRGP)
Year to date Share Price Gain: 79.98%
Number of Hedge Fund Holders: 39
Targa Resources Corp. (NYSE:TRGP) has been one of the top-performing energy stocks in 2024, with a remarkable year-to-date share price gain of 79.98%. This performance is driven by the company’s strong position in the midstream sector, particularly in North America’s natural gas and natural gas liquids (NGL) space. Targa’s comprehensive infrastructure for gathering, processing, transporting, and selling natural gas and NGL products, alongside its robust logistics and transportation network, makes it a key player in the energy market.
In its Q2 2024 earnings, Targa Resources Corp. (NYSE:TRGP) exceeded expectations, reporting earnings per share (EPS) of $1.33, compared to the expected $1.28. The company also posted record operational metrics, with adjusted EBITDA reaching $984 million—a 2% increase from the previous quarter. Targa’s strong performance was largely driven by record volumes from the Permian Basin, where natural gas inlet volumes reached 5.7 billion cubic feet per day, and NGL pipeline transportation volumes hit 784,000 barrels per day.
Targa’s ability to generate strong cash flows, even in a challenging commodity price environment, is a testament to its fee-based contract structure, which minimizes exposure to fluctuations in commodity prices. Approximately 90% of its margins are protected by these contracts, with additional hedging further insulating the company from market volatility. This financial stability has allowedTarga Resources Corp. (NYSE:TRGP) to return value to shareholders, highlighted by a $355 million stock repurchase during the quarter.
Moreover, Targa’s ongoing investment in infrastructure projects, such as its Train 9 fractionator and the Roadrunner II plant in the Permian, positions the company for future growth. With plans to invest approximately $2.7 billion in growth capital in 2024, Targa Resources Corp. (NYSE:TRGP) is well-prepared to capitalize on increasing volumes from the Permian Basin. The company’s participation in the Blackcomb pipeline joint venture further strengthens its position in the natural gas market.
In summary, Targa Resources Corp. (NYSE:TRGP) strong financial performance, growth-oriented investments, and solid fundamentals make it a standout energy stock for 2024. With continued expansion in key regions and a focus on shareholder returns, Targa is well-positioned for sustained success in the years ahead.
04. Texas Pacific Land Corporation (NYSE:TPL)
Year to date Share Price Gain: 83.06%
Number of Hedge Fund Holders: 21
Texas Pacific Land Corporation (NYSE:TPL) has diversified operations primarily in land and resource management, along with water services in the Permian Basin, positioning it as a key player in the energy sector. With an impressive year-to-date share price increase of 83.06% in 2024, the company reflects strong investor confidence in its business model and growth prospects. Its strategic advantages, particularly in oil and gas royalty interests, make Texas Pacific Land Corporation (NYSE:TPL) a fundamental stock to watch closely.
Texas Pacific Land Corporation (NYSE:TPL) financial performance in the second quarter of 2024 further underscores its bullish potential. The company reported record numbers across its water services and operations segment, with substantial increases in water sales and produced water royalties. Water sales volumes averaged 800,000 barrels per day, driven by demand from major customers like Exxon, Conoco, and BP. These numbers are significant, as they demonstrate Texas Pacific Land Corporation (NYSE:TPL) ability to leverage its infrastructure for both brackish and recycled water, capturing a growing market in the Permian Basin.
The produced water segment also delivered robust results, with a 43% increase in royalties from the previous year, collecting royalties on over 300 million barrels of produced water. This high-margin business, coupled with minimal operating costs, provides Texas Pacific Land Corporation (NYSE:TPL) with a strong cash flow stream, even amid fluctuating commodity prices. Additionally, the company’s royalty production saw steady growth, with oil and gas royalties comprising 52% of total revenue for Q2 2024.
Texas Pacific Land Corporation (NYSE:TPL) royalty model allows it to benefit from rising commodity prices without incurring the capital or operating costs typical of upstream operators. This unique advantage, combined with its strategic position in the Permian Basin, where it owns a vast amount of royalty acreage, gives the company a long runway for future growth. With continued demand for oil and gas and its water services segment performing at record levels, TPL is poised for further success in the energy market.
03. LandBridge Company LLC (NYSE:LB)
Year to date Share Price Gain: 93.37%
Number of Hedge Fund Holders: 15
LandBridge Company LLC (NYSE:LB) has established a unique position in the energy sector, coupled with a diversified infrastructure development strategy that sets it apart from traditional oil and gas firms. With a remarkable year-to-date share price gain of 93.37% in 2024, the company has emerged as one of the best-performing energy stocks. Operating in the resource-rich Delaware Basin, which spans Texas and New Mexico, LandBridge focuses on two key infrastructure areas: water processing and data centers. This diversification allows LandBridge Company LLC (NYSE:LB) to capitalize on both its land assets and the growing demand for critical infrastructure.
A critical aspect of LandBridge Company LLC (NYSE:LB) business model is its innovative approach to water processing. The Permian Basin, where LandBridge holds around 220,000 acres, produces a significant amount of water alongside oil. Texas allows for re-injection of this water, whereas New Mexico enforces stricter regulations, making water processing a critical issue. LandBridge is strategically positioned along the state border, giving it the advantage of exploiting regulatory differences. The company currently processes and transports 1.8 million barrels of water daily through its partnership with WaterBridge. This creates a significant free cash flow opportunity, with potential annual revenues projected at $200-300 million as the demand for water processing grows.
In addition to water management, LandBridge Company LLC (NYSE:LB) is venturing into digital infrastructure, planning to build data centers in the Permian Basin. The region’s abundant, low-cost energy and water resources make it an ideal location for large-scale data centers. LandBridge aims to develop six data centers, each generating an estimated $30-40 million annually. These data centers will be powered by a gigawatt power plant and a 250-megawatt solar farm, highlighting the company’s commitment to integrating renewable energy into its business model.
LandBridge Company LLC (NYSE:LB) diversified revenue streams make it an attractive investment. In addition to water royalties and data centers, the company generates income from oil, gas, and other infrastructure projects. With projections of up to $300 million from water processing and $40 million per data center, the company’s revenue potential is substantial. Despite its current market cap of $2.43 billion, analysts believe that LandBridge could reach a valuation of $10 billion, driven by its solid growth prospects and minimal debt load.
02. Summit Midstream Corporation (NYSE:SMC)
Year to date Share Price Gain: 102.01%
Number of Hedge Fund Holders: N/A
Summit Midstream Corporation (NYSE:SMC) stands out as a key player in the energy sector due to its extensive midstream infrastructure and strategic presence in major shale formations across the U.S. The company’s diverse operations, which include natural gas, crude oil, and water gathering systems, have supported its strong market performance in 2024, achieving a year-to-date share price gain of 102.01%. This impressive growth reflects Summit’s ability to navigate the energy landscape while capitalizing on operational efficiency and financial flexibility.
For the second quarter of 2024, Summit reported an adjusted EBITDA of $43.1 million and distributable cash flow of $11.7 million, showcasing its ability to generate steady cash flow despite a reported net loss of $23.8 million. Free cash flow came in at $2.7 million, further strengthening the company’s position. This financial stability allows Summit Midstream Corporation (NYSE:SMC) to pursue strategic acquisitions and debt reduction, aligning with its long-term goal of achieving a leverage target of 3.5x.
A major highlight for Summit this year was its successful reorganization from a master limited partnership (MLP) to a C-corporation, completed in August 2024. This move not only brings tax advantages but also makes Summit’s stock more attractive to a wider pool of investors. Additionally, Summit Midstream Corporation (NYSE:SMC) executed a $500 million revolving credit facility and issued $575 million in senior secured notes, both maturing in 2029, extending its debt maturity and providing enhanced liquidity.
On the operational front, Summit Midstream Corporation (NYSE:SMC) connected 34 new wells during Q2 2024, contributing to a total of 105 new wells year-to-date. The company’s oil price-driven segments, particularly in the Permian Basin, saw a 17.5% increase in volumes, driving EBITDA growth in this area. Meanwhile, Summit’s Rockies segment demonstrated resilience with increased liquids and natural gas throughput despite some operational downtime. With its robust asset portfolio, improved balance sheet, and strategic positioning, Summit Midstream Corporation (NYSE:SMC) is poised for continued growth, making it one of the best-performing energy stocks in 2024.
01. Sable Offshore Corp. (NYSE:SOC)
Year to date Share Price Gain: 125.07%
Number of Hedge Fund Holders: 11
Sable Offshore Corp. (NYSE:SOC) has demonstrated a strong operational focus and strategic developments in offshore oil and gas production, particularly with the Santa Ynez Unit (SYU), which have contributed to its impressive performance. With a remarkable year-to-date share price gain of 125.07% in 2024, Sable has emerged as one of the best-performing energy stocks. Despite reporting a net loss in the second quarter, the company’s ongoing efforts to restart production and implement safety measures have positioned it well for future growth, making it a compelling choice for energy investors this year.
For the second quarter of 2024, Sable Offshore Corp. (NYSE:SOC) reported a net loss of $165.4 million. The loss was primarily driven by changes in the fair value of warrant liabilities linked to an increase in the company’s common share price and the appreciation of warrants during the quarter. Additionally, production restart expenses and share-based compensation contributed to this outcome. However, the company’s balance sheet remains stable, ending the quarter with $112.1 million in cash and cash equivalents, while maintaining outstanding debt of $790.4 million. This financial flexibility will enable Sable Offshore Corp. (NYSE:SOC) to continue its strategic investments in the restart of its offshore operations.
Operationally, Sable made significant progress in the second quarter, receiving final regulatory approval for ownership and operatorship of the SYU, which consists of 16 Outer Continental Shelf leases spanning approximately 76,000 acres. The company also undertook substantial staffing efforts, adding over 200 contractors and 13 new employees to support the production restart. Notably, Sable has initiated an anomaly repair program and pipeline integrity surveys for its California Pipelines (Line 324 and Line 325), essential for meeting safety requirements.
In preparation for production, Sable Offshore Corp. (NYSE:SOC) has completed safety tests and equipment inspections across its offshore platforms and processing facilities, while also working on emissions reduction and compressor overhauls. These activities reflect Sable’s commitment to operational excellence and environmental responsibility, positioning the company for long-term success. With its solid financial metrics, extensive operational groundwork, and strategic focus on high-potential offshore assets, Sable Offshore Corp. (NYSE:SOC) stands out as a top performer in the energy sector in 2024.
While we acknowledge the potential of SOC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SOC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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