Whether you see them or not, energy businesses play a crucial part in our daily activities, from powering our homes and businesses to powering our transportation and industries.Still, their generally high capital requirements expose them to the ups and downs of commodity prices and economic cycles, and the industry’s six-month return of 6.8% has fallen short of the S&P 500’s 11.7% rise.
The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. On that note, here are two resilient energy stocks at the top of our wish list and one we’re passing on.
One Energy Stock to Sell:
Helix Energy Solutions (HLX)
Market Cap: $1.37 billion
Playing a pivotal role in the 2010 Macondo oil spill response with its Q4000 vessel, Helix Energy Solutions (NYSE: HLX) provides specialized services to extend the life of offshore oil and gas wells and decommission aging infrastructure.
Why Are We Cautious About HLX?
- Revenue base of $1.30 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- Costly operations and weak unit economics result in an inferior gross margin of 11.4% that must be offset through higher production volumes
Helix Energy Solutions is trading at $9.33 per share, or 23.1x forward P/E. To fully understand why you should be careful with HLX, check out our full research report (it’s free).
Two Energy Stocks to Watch:
Matador Resources (MTDR)
Market Cap: $5.84 billion
Operating primarily in the Delaware Basin where multiple oil-bearing layers lie stacked thousands of feet deep, Matador Resources (NYSE: MTDR) explores for, drills, and produces oil and natural gas from underground rock formations in New Mexico and Texas.
What Makes MTDR Stand Out?
- Market share has increased this cycle as its 29.2% annual revenue growth over the last ten years was exceptional
- Attractive asset base leads to wonderful unit economics and a best-in-class gross margin of 81.9%
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
Matador Resources’s stock price of $47.43 implies a valuation ratio of 6.2x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
CNX Resources (CNX)
Market Cap: $5.11 billion
Tracing back to operations that began in 1860, CNX Resources (NYSE: CNX) drills for and produces natural gas from underground shale formations in Pennsylvania, Ohio, and West Virginia.
Why Are We Fans of CNX?
- Attractive asset base leads to wonderful unit economics and a premier gross margin of 68%
- EBITDA margin didn’t move over the last five years, showing it couldn’t increase its efficiency
- Strong free cash flow margin of 23.5% enables it to reinvest or return capital consistently
At $34.54 per share, CNX Resources trades at 11x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
