I think, once we get the covid vaccine, and as the economy slowly gets back to normal, gas consumption will revert to normal. May be it may take another 6 months or so to burn through, :), the inventory.Assuming you have 2 year recovery, what are some of the names you are looking at.
I don't think the old-style value plays like cheap industrials or consumer staples work anymore. I don't know why or if they should, logically, but something has changed with the advent of hyper growth techs. Maybe this too shall pass. Covid certainly gave a leg up to PG CLX etc, but Ii doubt the outperformance will last. OK so no more philosophy. I am looking at companies that will return when Covid is over. Cruise lines like CCL RCL NCLH, good airlines like LUV HA, etc. Not buying yet, because I think a Covid super storm is coming in US thanks to incompetent response by the current government. These will be beaten down again and I will buy them then. For now I am buying energy ETFs
Hit sumbit too fast. Energy ETFs like FENY / VDE (take your pick). No doubt electric vehicles are the future, but even dying industries can be profitable for a long long time, look at tobacco.
gas consumption will revert to normal.Energy use in general?If the play is a return to increased usage (volume), I would consider looking at closed end funds that hold MLPs. Not a bad way to own MLPs and CEFs will often trade at discounts to NAV. They are also often modestly levered. So a sector return to value can be exploited well in a CEF.For example (random), MIE, Cohen & Steers MLP Income and Energy Opportunity Fund, has been hammered this year (-70% YTD). It is levered at just over 30%. Historically it trades at about 8-9% discount to NAV, but is now at a > 20% discount. I'd watch items that could be problematic for the leverage (as happened in 2007 in the CEF space), but otherwise consider dipping into the space.
I don't think gas consumption in the USA will ever recover to pre covid19 levels.Many tens of thousand workers will no longer be commuting daily to a office. Work from home is not a short term macro economic change. Business travel will never return to pre covid19 levels. Gas and aviation fuel reductions.EVs will be the next car purchase for many consumers. Another permanent reduction in gas usage.
I don't think gas consumption in the USA will ever recover to pre covid19 levels. May be. Separately, the supply can also go down because below certain price it is uneconomical. Separately, world wide consumption will continue to grow, especially developing countries like India will be adding far higher demand than the reduction that could happen in USA.Energy, has to be viewed from global perspective.
I don't have many value stocks. But, my favorite--an 8% holding--is OKE. The Fool seems enamored with KMI but to me OKE has better management and is better positioned. Yields 9.5% dividend.I'll just post a couple of Seeking Alpha links:https://seekingalpha.com/article/4395016-oneok-is-up-55-this......andhttps://seekingalpha.com/article/4394104-oneok-oke-presents-......KC
some of my energy picks XLE $37 to $61, XOM $40 to $68.8 APA $12 to $20, OIH $145 to $211...Still I feel energy is undervalued. Especially OIH, 2014 over $1000, even in 2017 over $650, is barely $200 now. This one has a strong runway.
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