2 Dirt Cheap Energy Stocks You Can Buy and Hold for the Next Decade
This year, energy stocks have been one of the few bright spots in the stock market. The energy sector has delivered a roughly 30% gain, fueled by higher oil and natural gas prices. That's due to improving demand coming out of the pandemic and tightening supplies as a result of years of underinvestment, made worse by Russia's invasion of Ukraine. Those market dynamics suggest that energy prices could remain high for years to come.
Even with this year's gain, energy stocks remain relatively cheap, especially given the growth that appears to be ahead. Some of the best values are in the pipeline sector, where companies trade at deep discounts. Two dirt cheap pipeline stocks are Kinder Morgan (NYSE: KMI) and Williams Companies (NYSE: WMB). They look like great value buys considering what lies ahead in the sector.
Shares of Kinder Morgan are up about 10% this year, which is impressive considering the more-than-20% plunge in the S&P 500. However, even with that rally, the natural gas pipeline giant's stock is incredibly cheap. Kinder Morgan expects to produce $2.07 per share of distributable cash flow this year. With its share price recently around $17.25, it trades at about eight times cash flow, giving it a 12% free cash flow yield.
Source Fool.com
