The oil and gas penny stock universe is comprised of small companies involved in the exploration, extraction, refining, and transportation of oil and gas products. These stocks typically trade below $5 per share. The oil and gas industry also includes companies that provide drilling and well-maintenance services. Some examples of these penny stocks include Kosmos Energy Ltd. (KOS), Abraxas Petroleum Corp. (AXAS), and SM Energy Co. (SM). Prices for crude oil and natural gas plunged earlier this year as the impact of COVID-19 slashed demand. While prices have recovered somewhat, the collapse in demand and prices has adversely affected some companies.
Oil and gas penny stocks are generally represented by the Invesco S&P SmallCap Energy ETF (PSCE), though the fund includes many micro- and small-cap stocks that are not considered penny stocks. PSCE has dramatically underperformed the broader market with a total return of -33.3% over the past 12 months, well below the Russell 1000's total return of 20.7%, as of December 1, 2020. All statistics in the tables below are as of December 2.
Here are the top 3 oil and gas penny stocks with the best value, the fastest growth, and the most momentum.
Best Value Oil and Gas Penny Stocks
These are the oil and gas penny stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
|Best Value Oil and Gas Penny Stocks|
|Price ($)||Market Cap ($M)||12-Month Trailing P/E Ratio|
|QEP Resources Inc. (QEP)||1.58||382.7||13.2|
|Helix Energy Solutions Group Inc. (HLX)||3.86||579.6||24.1|
|Clean Energy Fuels Corp. (CLNE)||4.40||872.4||25.9|
- QEP Resources Inc.: QEP Resources is an independent crude oil and natural gas exploration and production company. The company posted a net loss of $49.2 million as revenue sank 42.2% in Q3 2020, which ended September 30, 2020. It was a significant change from the net income of $81.0 million reported in the year-ago quarter.
- Helix Energy Solutions Group Inc.: Helix Energy Solutions is an offshore energy company focused on subsea construction, and maintenance and salvage services to the offshore natural gas and oil industry. The company also offers well intervention and robotics operations to the offshore industry. Helix Energy reported a 22.7% decline in net income (including net income to non-controlling interests) as net revenue fell 9.0% in Q3 2020, which ended September 30, 2020. The company said that its operations and customer demand continue to be negatively affected by the pandemic.
- Clean Energy Fuels Corp.: Clean Energy Fuels is a producer of renewable natural gas. That means they create natural gas from decomposing organic waste, rather than extracting it from underground deposits.
Oil and Gas Penny Stocks With the Most Profit Growth or Least Profit Decline
These are the oil and gas penny stocks with the highest year-over-year (YOY) earnings per share (EPS) growth or lowest EPS decline for the most recent quarter. A company’s ability to maintain profitability in a difficult business environment can be a sign of good management and/or a strong business model.
|Oil and Gas Penny Stocks With the Most Profit Growth or Least Profit Decline|
|Price ($)||Market Cap ($B)||EPS Growth (%)|
|EnLink Midstream LLC (ENLC)||3.78||1.9||50.0|
|Helix Energy Solutions Group Inc. (HLX)||3.86||0.6||-23.8|
|Ultrapar Participacoes SA (UGP)||4.07||4.4||-34.5|
- EnLink Midstream LLC: EnLink Midstream is an independent midstream energy services company providing supply and marketing services to consumers and producers. The company engages in natural gas gathering, treating, processing, transmission, distribution, supply, and marketing, and crude oil marketing. EnLink Midstream posted net income growth of 4.5% despite a 34.1% decline in revenue in Q3 2020, which ended September 30, 2020. The cost of sales fell at a faster rate than revenue, helping to boost net income.
- Helix Energy Solutions Group Inc.: See above for company description.
- Ultrapar Participacoes SA: Ultrapar Participacoes is a Brazil-based holding company whose subsidiaries provide gas and petrochemical storage and distribution services.
Oil and Gas Penny Stocks with the Most Momentum
These are the oil and gas penny stocks that had the highest total return over the last 12 months.
|Oil and Gas Penny Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|Clean Energy Fuels Corp. (CLNE)||4.40||0.9||125.6|
|Antero Resources Corp. (AR)||3.86||1.0||94.0|
|Southwestern Energy Co. (SWN)||2.95||2.0||62.1|
|Invesco S&P SmallCap Energy ETF (PSCE)||N/A||N/A||-33.3|
- Clean Energy Fuels Corp.: See above for company description.
- Antero Resources Corp.: Antero Resources is an oil and gas exploration and production company. It focuses on the acquisition, development, and production of unconventional oil and liquids-rich natural gas properties.
- Southwestern Energy Co.: Southwestern Energy engages in natural gas and oil exploration, development, and production. The company announced in mid-November that it had completed its acquisition of Montage Resources Corp., an oil and gas exploration and production company.
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YCharts. "Financial Data." Accessed Dec. 2, 2020.
QEP Resources Inc. "QEP Resources Reports Third Quarter 2020 Financial and Operating Results." Accessed Dec. 2, 2020.
Helix Energy Solutions Group Inc. "Helix Reports Third Quarter 2020 Results." Accessed Dec. 2, 2020.
EnLink Midstream LLC. "EnLink Midstream Reports Third Quarter 2020 Results and Announces $100 Million Common Unit Repurchase Program." Accessed Dec. 2, 2020.
Southwestern Energy Co. "Southwestern Energy Completes Acquisition of Montage Resources." Accessed Dec. 2, 2020.