5 Oversold Energy Stocks You Can Buy Right Now

In this article, we discuss 5 oversold energy stocks you can buy right now. To read the detailed analysis of the energy industry, go directly to the 11 Oversold Energy Stocks You Can Buy Right Now.

5. Clean Energy Fuels Corp. (NASDAQ:CLNE)

14-day RSI: 29.58

Number of Hedge Fund Holders: 19

Clean Energy Fuels Corp. (NASDAQ:CLNE) is a renewable energy company that procures and provides renewable natural gas (RNG) and conventional natural gas in various forms.

On March 6, Scotiabank lowered the price target on Clean Energy Fuels Corp.’s (NASDAQ:CLNE) stock to $6 from $7 and maintained an Outperform rating on the shares. It is one of the most oversold energy stocks to buy now and has a 14-day RSI of 29.58, as of March 13.

In the fourth quarter, 19 hedge funds held positions in Clean Energy Fuels Corp. (NASDAQ:CLNE) and the total stakes amounted to $47.809 million. With a position worth $10.25 million, Till Bechtolsheimer’s Arosa Capital Management is the most prominent shareholder in the company, as of December 31, 2023.

On February 26, Clean Energy Fuels Corp. (NASDAQ:CLNE) announced that it expanded its fueling network by opening up two new fueling stations offering natural gas in the DFW area.

4. Teekay Corporation (NYSE:TK)

14-day RSI: 39.97

Number of Hedge Fund Holders: 19

Teekay Corporation (NYSE:TK) is engaged in providing marine transportation and related services essentially for crude oil on an international scale. In the fourth quarter, Teekay Corporation (NYSE:TK) reported its fourth-quarter earnings result with a non-GAAP EPS of $0.35 and revenue of $339.19 million.

Teekay Corporation (NYSE:TK) has a 14-day RSI of 39.97 and a trailing twelve-month (TTM) PE ratio of 4.81, as at the time of writing on March 13. It is one of the best oversold energy stocks to buy now according to hedge funds.

In Q4, Teekay Corporation (NYSE:TK) was part of 19 hedge funds’ portfolios. The funds’ stakes amounted to $77.504 million. D E Shaw is the largest shareholder in the company with a position worth $8.476 million, as of December 31, 2023.

3. CONSOL Energy Inc. (NYSE:CEIX)

14-day RSI: 37.15

Number of Hedge Fund Holders: 29

CONSOL Energy Inc. (NYSE:CEIX) is a thermal coal company headquartered in Pennsylvania. The company has over 620 million tons of recoverable coal reserves from three mines. CONSOL Energy Inc. (NYSE:CEIX) has a 14-day RSI of 37.15 at the time of writing on March 13.

Greenlight Capital is the largest shareholder of CONSOL Energy Inc. (NYSE:CEIX) in Q4 2023, with 2.1 million shares worth $211.67 million. Additionally, 29 hedge funds tracked by Insider Monkey had stakes in the company as of December 31, 2023, compared to 25 in the third quarter.

Black Bear Value Partners stated the following regarding CONSOL Energy Inc. (NYSE:CEIX) in its fourth quarter 2023 investor letter:

“We have a large investment across the energy & commodity spaces. We have not developed enough energy or commodity resources to satisfy the near- and medium-term needs of the world as well as provide for a renewable/less-carbon intensive future.

CONSOL Energy Inc. (NYSE:CEIX) is an American energy company focused on the coal sector. The business has undergone a shift from being a majority producer of coal for domestic energy purposes to an export-driven producer of coal for non-power generation purposes.

While there is a negative stigma associated with coal (and some deserved) there are parts of the world that have limited energy alternatives and will require coal supply over the coming years. I expect the company to commit a large amount of the free-cash-flow to buying in cheap stock and the per share intrinsic value to grow substantially over the next 3 years.

Rough valuation thoughts on CONSOL…. Over the coming 2 years CEIX should generate $20-$40 in per share FCF. They own a marine terminal which is conservatively worth $15-$30 in per share value. Over the long-term the business should generate $300MM+ of annual FCF. At reasonable multiples this comes out to $60-$100 per share. Add these related pieces up and you will arrive at a price of $95-$170 vs. a $100 year-end stock price. Clearly in the short term, volumes and prices could be worse but over the medium-long term our downside seems limited given the lack of financial leverage.”

2. Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR)

14-day RSI: 32.01

Number of Hedge Fund Holders: 36

Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) is a Brazilian state-owned oil and gas company that has recently been pushed into oversold territory due to its latest smaller-than-expected dividend payout. The dividend controversy remains unsolved as the company’s CEO and the government-appointed board of directors are in a battle regarding the dividend payout. Earlier in March, the board of directors rejected a proposal of special dividend payments to Petróleo Brasileiro S.A. – Petrobras’ (NYSE:PBR) shareholders as the government wants the money to be reinvested into the company.

The sell-offs following the dividend controversy have pushed Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) toward a 14-day RSI of 32.01 as of March 13, and the stock is trading at a TTM price-to-earnings multiple of 3.57.

As of the fourth quarter of 2023, Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR)’s stock was held by 36 hedge funds. Rajiv Jain’s GQG Partners remains the most prominent shareholder of the company, with over 213 million shares worth $3.4 billion.

Fairlight Capital made the following comment about Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) in its Q3 2023 investor letter:

“Throughout the year, we have reviewed thousands of companies, including many in the oil sector. While we are generally cautious about commodity-based businesses where the company lacks control over the price of what it produces, the valuations in several cases have reached extremely compelling levels. For example, Petróleo Brasileiro S.A. – Petrobras (NYSE:PBR) and Ecopetrol (EC). Petrobras has distributed dividends of over $2.30 paid this year3 , while Ecopetrol has traded as cheaply as the $9-$10 range (close to our purchase price) and is paying approximately $2.50 in dividends this year.

We factor in the potential cost of FX movements over time, but even under the most pessimistic scenarios the investments should work out well. We initially came across these ideas while looking at South American stocks in general. We saw that many market commentators had expressed concerns that Ecopetrol’s dividends might be halted, especially following the election of Gustavo Petro as president of Colombia in June 2022. Similarly, there have been reservations about the sustainability of Petrobras’s dividend. However, the government owns substantial controlling stakes in these companies and is also a recipient of their dividends. For Ecopetrol, the Colombian government owes money to Ecopetrol due to the Fuel Price Stabilization Fund (FEPC). This fund aims to stabilize fuel prices for Colombian consumers. It bridges the gap between international and national Colombian consumer prices by compensating producers and importers for this price difference. The primary goal is to cushion the impact of global oil price fluctuations on the Colombian market. This is achieved either through cash payment or by forgoing dividend payments due from the government’s stake in these companies. In Ecopetrol’s case, the dividends paid (or those that would be paid to the government) are applied against the outstanding balances…” (Click here to read the full text)

1. EQT Corporation (NYSE:EQT)

14-day RSI: 35.24

Number of Hedge Fund Holders: 40

EQT Corporation (NYSE:EQT) is an American energy company primarily focusing on natural gas. In the fourth quarter of 2023, the company stock was owned by 40 hedge funds at a combined value of $1.06 billion. On top of that, the company has a 14-day RSI of 35.24 at the time of writing on March 13. EQT Corporation (NYSE:EQT) takes the top spot on our list of oversold energy stocks.

On March 11, EQT Corporation (NYSE:EQT) announced its plan to repurchase Equitrans Midstream Corporation (NYSE:ETRN), a company it had spun off in 2018, in a $5.5 billion stock deal. The announcement sparked controversy among investors which led to a major sell-off. However, the company’s CEO Toby Z. Rice disagrees with the general sentiment and said that it is “the most strategic and transformational transaction EQT has ever pursued.”

EQT Corporation (NYSE:EQT) was mentioned by ClearBridge Investments in its Q2 2023 investor letter. Here is what it said:

“The energy sector was another positive contributor, primarily driven by our investment in EQT Corporation (NYSE:EQT). As North America’s leading natural gas provider, EQT had seen its share price slide as the lackluster reopening of China and a milder-than-expected winter in the northern hemisphere weighed on natural gas prices. However, as recessionary fears have given way to optimism and the prospect for greater energy demand, EQT’s share price has rebounded. While we continue to expect volatility in commodities prices, we believe that global energy demand, especially in Europe, along with the company’s leadership position in the natural gas market, make it a strong long-term compounder for the portfolio.”

You can also look at the Top 25 Oil Exporting Countries in the World in 2024 and the 16 Best Large-Cap Value Stocks To Invest In in 2024.