3 Energy Penny Stocks to Add to Your Watchlist Right Now
In the past few weeks, the price of oil and subsequently, energy penny stocks, have both skyrocketed. With WTI and Brent Crude up by over 4.5% and 3.1% during today’s trading respectively, there is a lot for investors to consider here. And because of that, it’s worth taking a look at what effect it will have on penny stocks and why.
Why is the Price of Oil Increasing?
The main reason behind the recent spike in the price of oil has to do with the Russian invasion of Ukraine. With news continuing to come out regarding the tragedy unfolding in Ukraine, the supply of Russian oil to the world continues to be cut off. As a result, the price of oil has skyrocketed to levels not seen in years.
This includes oil trading at around $100 per barrel, which is a major increase over where it was only a few weeks ago. For context, Russia is the third-largest exporter of oil in the world and the second-largest of natural gas. This translates to roughly 10% of the oil in the world and 40% of natural gas supplied to Europe.
While the sanctions right now are necessary to impede Russia’s move into Ukraine, there is no doubt that there is backlash for the U.S. The President of the Richmond Federal Reserve, Tom Barking, stated that “if oil prices do continue to go up…it absolutely is going to increase recorded inflation. But, it also constrains spending.”
Only a few weeks ago, we saw news that U.S. inflation hit its highest number in almost forty years. This in combination with the rising price of oil shows that we are in a very volatile stock market right now. For that reason, understanding how to make money with penny stocks and take advantage of the current situation is crucial. Considering this, let’s take a look at three energy penny stocks to watch in March 2022.
3 Energy Penny Stocks to Watch in March
Transocean Ltd. (NYSE: RIG)
One of the larger gainers of the day is RIG stock. By EOD, shares of RIG had shot up by over 5.5% to more than $3.50 per share. And, in the past month, RIG stock has climbed by more than 11.5%. This is a substantial gain and one that reflects both Transocean as a company, and the environment on oil and gas right now as well. To understand why shares of RIG stock are climbing, we have to take a closer look at the company. On February 22nd, Transocean reported its fourth quarter and full year 2021 results.
In the results, the company posted drilling revenue of around $621 million. While its revenue efficiency dropped by around 4% from 98.1% to 94.5%, the company still managed to bring in an adjusted EBITDA of $250 million. This is compared to $245 million in the previous quarter. On top of all of this, the company stated that its contract backlog was $6.5 billion as of the end of February 2022. This is all highly exciting news and shows that Transocean is in a financially advantageous position right now.
“Our steadfast focus on safety, reliability and efficiency enabled us to once again deliver strong operational results for our customers in 2021, which ultimately translated into industry leading financial results.”The CEO of Transocean, Jeremy Thigpen
So, with the exciting investing environment surrounding energy right now, it’s clear that RIG is popular among traders. But, whether it deserves a spot on your penny stocks watchlist or not is up to you.
Kosmos Energy Ltd. (NYSE: KOS)
Another big gainer of the day so far is KOS stock. By EOD on February 28th, shares of KOS stock shot up by over 8%. This brings it to $4.86 as of market close on the 28th. The main reason for Kosmos’ gain today comes as the company announced its fourth quarter and full year 2021 results. In the results, it posted a net income for its fourth quarter 2021, of $99 million, or $0.22 per diluted share.
During the quarter, the company completed the acquisition of several interests in Ghana, totaling around $460 million after adjustments. For the fourth quarter, Kosmos generates more than $573 million in revenue with a production expense of $134 million. All of this is very exciting and comes as KOS stock has returned over 100% to investors in the past six months. Considering that, do you think KOS stock is worth adding to your list of penny stocks to buy or not?
Gran Tierra Energy Inc. (NYSE: GTE)
With a 1.4% gain on February 28th, GTE is also seeing investor attention right now. Although this is not as much as other energy penny stocks today, it is still quite substantial. And in the past month, shares of GTE stock have shot up by over 45% with a six month gain of a staggering, 159%. Only a few weeks ago, the company announced that it achieved a 148% PDP and 123% 1P reserve replacement.
“During 2021, Gran Tierra achieved strong 148% PDP and 123% 1P reserves replacement through our successful results from our development drilling, waterflooding programs and field performance.
We completed our 2021 development plan on budget including waterflooding efforts and development drilling in the Acordionero and Costayaco oil fields, as well as workover activities in the Moqueta oil field.”The President and CEO of Gran Tierra, Gary Guidry
As an international oil and gas exploration company, Gran Tierra remains an interesting player in several geographic areas of the energy industry. Considering all of this, is GTE stock a buy or not as the price of oil continues to skyrocket?
Which Energy Penny Stocks Are on Your Watchlist Right Now?
As the price of oil and gas continue to rise substantially, investors are looking for the next best penny stocks to buy. But, understanding where to look and which penny stocks are worth it, is crucial to making money with small caps.
Although it can be difficult given how quickly the stock market is moving, staying up to date with all the latest news and events will give you a major advantage. With that in mind, which energy penny stocks are you watching right now?