Two high-yield producers with gains ahead

Article Excerpt

Oil and gas stocks moved up as the U.S. and other economies recovered after the pandemic. The war in Ukraine also spurred prices. Prices have softened lately on fears of slowing global economies, but we still recommend that most investors maintain exposure to the oil and gas industry as part of a balanced portfolio. To cut risk, you should focus on producers with positive cash flow even at lower energy prices. Here are two that meet that requirement—and pay high dividends. COTERRA ENERGY, $26.50, is a buy. The company (New York symbol CTRA; TSINetwork Rating: Extra Risk) (www.coterra.com; Shares o/s: 757.5 million; Market cap: $20.0 billion; Dividend yield: 8.6%) produces and explores for natural gas and oil. Gas makes up 41% of the company’s output; the remaining 59% is oil. Coterra is the new name for oil-focused Cimarex Energy after its 2021 acquisition of gas-focused Cabot Oil & Gas Corp. The combination of those two U.S. shale drillers—Cimarex, an operator in Texas, Oklahoma and New Mexico, and…