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The two energy stocks that could be a must buy in 2024

by Thea Coates Finance Reporter
26th Jun 24 9:12 am

There is a general acceptance around the globe of the need to explore clean, renewable, and sustainable energy sources.

This much is evident from stakeholder insistence on companies adhering to ESG standards in all their operations.

For this reason, energy stocks are emerging as ideal investment options in 2024.

  • Now that the climate change and global warming conversation has become mainstream, energy stocks could be the next big thing.
  • Cheniere Energy is an American natural gas liquefaction powerhouse, boasting one of the world’s largest natural gas liquefaction platforms.
  • NextEra Energy is one of the companies leading the renewable energy conversation in America, regularly producing electricity from wind and solar.

Like tech stocks dominated the market last year, energy stocks could dominate this year, and investors would be wise to buy some of these stocks to bolster their portfolios.

Joel Lim, financial analyst at tradequotex.com, has identified two energy stocks he believes are absolute must-haves for any investor looking to invest in this space.

Cheniere Energy

Cheniere Energy is an American natural gas liquefaction company that boasts some of the world’s largest liquefaction platforms. The company has facilities in Louisiana and Texas and has openly declared plans to pursue liquefaction expansion opportunities outside of America.

What makes Cheniere Energy an excellent pick is the company’s specialization. Natural gas is far cheaper than other energy sources, such as coal, and has replaced it as the main energy source for many utilities. Furthermore, it is far easier to transport, especially in liquified form.

However, transforming natural gas to its liquid form is harder than you would assume and requires massive infrastructure. Companies like Cheniere Energy are able to handle these drawbacks thanks to state-of-the-art facilities across the country. If allowed to expand outside of America, the company’s value could rapidly increase, making it a high-potential investment that no investor should pass on.

Joel Lim notes, “Cheniere Energy has performed well financially this year. According to its latest quarterly report, the company generated a revenue of $4.3 billion and a net income of $0.5 billion.”

NextEra Energy

NextEra Energy is an American renewable energy company that specializes in producing electricity from renewable sources, such as wind and solar. This makes it an excellent portfolio addition for investors looking to benefit from the energy transition agenda.

On the topic of clean energy, NextEra Energy is clearly ahead of the competition. In a recent announcement, the company announced plans to partner with Entergy to develop around 4.5 GW of new solar and energy storage projects. The partnership aims to provide low-cost renewable energy across the country, focusing on states like Arkansas, Louisiana, Texas, and Mississippi.

Furthermore, NextEra Energy has performed impressively this year on the financial front. According to its recent quarterly report, the company recorded a GAAP basis of $2.268 billion and $1.873 in first-quarter earnings. In contrast, the company recorded a GAAP basis of $2.086 billion and $1.678 in first-quarter earnings last year.

Joel Lim notes, “NextEra Energy is a must-have, especially for investors interested in capturing value in the renewable energy space.”

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