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.But their prominence also brings high exposure to the ups and downs of economic and energy cycles. Luckily, their overall demand was steady over the past six months as the industry’s 10.6% return has closely followed the S&P 500.
Although these companies have produced results lately, a cautious approach is imperative. When the cycle naturally turns, the losers can be left for dead while the winners consolidate and take more of the market. On that note, here are two energy stocks we think can generate sustainable market-beating returns and one best left ignored.
One Energy Stock to Sell:
Bristow Group (VTOL)
Market Cap: $1.34 billion
Operating what's essentially an airborne taxi service for some of the world's most remote workplaces, Bristow Group (NYSE:VTOL) operates helicopters that transport workers to offshore oil and gas platforms and conduct search and rescue operations.
Why Do We Think VTOL Will Underperform?
- Muted 6.1% annual revenue growth over the last five years shows its demand lagged behind its energy upstream and integrated energy peers
- Subscale operations are evident in its revenue base of $1.56 billion, meaning it has fewer distribution channels than its larger rivals
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 0% for the last five years
At $45.29 per share, Bristow Group trades at 5.9x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including VTOL in your portfolio.
Two Energy Stocks to Buy:
EQT (EQT)
Market Cap: $33.6 billion
The largest natural gas producer in the United States by daily volume, EQT (NYSE:EQT) produces natural gas and natural gas liquids from wells drilled in the Appalachian Basin.
Why Should You Buy EQT?
- Impressive 15.3% annual revenue growth over the last ten years indicates it’s winning market share this cycle
- EBITDA profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends
EQT is trading at $53.73 per share, or 15.8x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
APA Corporation (APA)
Market Cap: $15.2 billion
Operating in three continents with a history stretching back to 1954, APA Corporation (NASDAQ:APA) explores for, develops, and produces crude oil, natural gas, and natural gas liquids in the U.S., Egypt, and the U.K. North Sea.
Why Is APA a Top Pick?
- 4.8% annual revenue growth over the last ten years surpassed the sector average as its products resonated with customers
- Enormous revenue base of $8.37 billion provides significant leverage in supplier negotiations
- Highly-profitable operating model results in strong unit economics and a top-tier gross margin of 67.8%
APA Corporation’s stock price of $43.44 implies a valuation ratio of 10.1x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.