The oil and gas juniors on our list could continue to power higher should market sector rotation move from momentum to underperforming cyclicals
SmallCapPower | February 25, 2020: Bloomberg News reported recently that Swiss bank UBS Group is recommending investors begin buying underperforming cyclical sectors such as energy and autos and start selling tech and software companies. This is due to the potential bubble risk from popular passive ETF investing styles, such as momentum and low volatility. These sectors could sell off sharply, causing investors to move into underperforming sectors such as energy. Today we have drilled down and discovered four TSXV-listed oil and gas juniors that have the potential to significantly outperform should a sector rotation into energy stocks come to fruition.
*Share prices as at February 21, 2020, data obtained from S&P Capital IQ
CGX Energy Inc. (TSXV:OYL) – $0.68
Oil and Gas
CGX Energy, an oil and gas exploration company, explores and evaluates petroleum and natural gas properties in Guyana, South America. It holds interests in three petroleum agreements, including the Corentyne, Berbice, and Demerara blocks covering an area of approximately 11,005.2 square kilometers located in offshore and onshore Guyana.
- Market Cap: $185.2M
- 7-Day Return: +2.9%
- YTD-Return: +31.5%
- 1-Year Return: +121.9%
- 90-Day Average Trading Volume: 45,900
CruzSur Energy Corp. (TSXV:CZR) – $0.245
Oil and Gas
CruzSur Energy operates as an oil and gas company in Latin America. The Company engages in exploration and development activities and holds various assets in Colombia and Argentina. CruzSur Energy was formerly known as PentaNova Energy and changed its name to CruzSur Energy Corp. in August 2018.
- Market Cap: $7.2M
- 7-Day Return: -5.0%
- YTD-Return: +11.8%
- 1-Year Return: +62.9%
- 90-Day Average Trading Volume: 32,610
Alvopetro Energy Ltd. (TSXV:ALV) – $0.66
Oil and Gas
Alvopetro Energy engages in the acquisition, exploration, development, and production of hydrocarbons in the Recôncavo basins in onshore Brazil. The Company holds interests in the Caburé and Gomo natural gas assets; two oil fields including Bom Lugar and Mãe-da-lua; and seven other exploration assets comprising 65,151 gross acres in the Recôncavo basin onshore Brazil.
- Market Cap: $64.9M
- 7-Day Return: +1.5%
- YTD-Return: -15.4%
- 1-Year Return: +53.5%
- 90-Day Average Trading Volume: 101,590
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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