After a hectic 2022, the energy industry is expected to enjoy continued hot demand this year.
The war in Europe is still going, and the transition to renewable energy requires years for infrastructure to be built and brought online.
That means ASX shares of existing energy producers will cash in.
Marcus Today equity analyst Damien Shaw this week helpfully picked out two S&P/ASX 200 Index (ASX: XJO) energy stocks he would buy into right now:
‘Optimistic’ this gas producer will meet its targets
Shaw is a fan of Beach Energy Ltd (ASX: BPT) even though the company’s third-quarter production dropped 5%.
“The decrease can be attributed to planned and unplanned outages,” Shaw told The Bull.
“Guidance remains on target. Progress is continuing at the Waitsia gas plant, with first gas targeted by the end of 2023.”
The balance sheet is “robust”, he added.
“We remain optimistic that Beach Energy will achieve its full year production targets, supported by expanding existing projects and a new gas plant.”
The Beach Energy share price has fallen 5.4% year to date, while paying out a 2% dividend yield.
Shaw’s peers seem to largely agree with his bullishness for the gas producer.
According to CMC Markets, 13 out of 19 analysts currently rate Beach as a buy.
‘It’s presented a buying opportunity’
Karoon Energy Ltd (ASX: KAR) has also experienced recent hardships, seeing its stock price dive more than 11% over the past 10 days or so.
“The oil and gas producer recently suspended production at its Bauna project in Brazil. Also, the Brazilian Government announced a tax increase on oil exports,” said Shaw.
“These events caused the stock price to marginally slip.”
But for those investing with a long-term horizon, the dip is an incentive to dive in right now.
“In our view, it’s presented a buying opportunity, as Karoon Energy offers strong management and high growth potential.”
The short-term crash hasn’t impacted longer-term performance too badly. Karoon is only down 1.8% year to date, and has actually gained 5.9% over the past 12 months.
Again, many other professionals also reckon Karoon is headed up. Nine out of 11 analysts currently surveyed on CMC Markets rate it as a buy.
The post ‘High growth potential’: 2 ASX 200 energy shares to buy this week appeared first on The Motley Fool Australia.
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More reading
- 5 things to watch on the ASX 200 on Wednesday
- 5 things to watch on the ASX 200 on Monday
- 5 things to watch on the ASX 200 on Friday
- 5 things to watch on the ASX 200 on Thursday
- 5 things to watch on the ASX 200 on Wednesday
Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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