Six Energy ADRs with Attractive Yields

Many stocks in the oil, gas and utility sectors have attractive dividend yields at current prices. Six of them are listed below with their current yields. Though they may fall further due to volatile market conditions, they are definitely worth looking into for potential long-term investment opportunities.

1. ENI SPA (E)
Country: Italy
Sector: Oil & Gas - Integrated
Dividend Yield: 8.43%

2. National Grid PLC (NGG)
Country: UK
Sector: Electric Utilities
Dividend Yield: 4.86%

3. TransCanada Corp (TRP)
Country: Canada
Sector: Natural Gas Utilities
Dividend Yield: 5.02%

4. PetroChina Company Ltd. (PTR)
Country: China
Sector: Oil & Gas - Integrated
Dividend Yield: 4.05%

5. Petrobras Energia Participaciones SA (PZE)
Country: Argentina
Sector: Oil & Gas - Integrated
Dividend Yield: 6.15%

6. Statoilhydro ASA (STO)
Country: Norway
Sector: Oil & Gas - Integrated
Dividend Yield: 4.37%

Comments

[aber:]

i'm in Italy and i'm long (in Milan stock market) on E
is a good company , well connected in Russia (natural gas) and with the italian gov. . Ita has gas station everywhere in Italy
the actual management is saying to keep the dividend if the oil price will stay equal or (better) above 40$ and is cutting cost

i'm long also on NGG , will buy more if drops more

btw I have been wrong about stocks, a lot , before

Apr 08 09:31 AM

[Michael Fit...:]

last year, STO paid $1.65/share (US$ per share ADS).
if StatOil were to pay the same dividend this year, the stock would yield 9.4% at today's closing price of $17.51.

STO's dividend is difficult to analyze for three reasons:
1) the company is not good about publicizing ADS share dividends
2) the company usually reports dividends in Norway's currency
3) the dividend is paid once per year, instead of once per quarter as most US energy firms

this throws alot of financial websites (and analysts) off. your article says STO yields 4.37%, but i am not sure how you came up with that number. STO's annual meeting is on May 19th. that is when they will declare the dividend for this year, and it will be paid out a few weeks after the meeting. i would be you a cup of coffee the yield will be substantially more than 4.37% if the stock is anywhere near today's closing price. for this reason, STO is a strong buy at this price, and anything near this price prior to the ex-dividend date.

Apr 08 07:29 PM

[Old Trader:]

Michael,

From my experience, many, if not most European companies pay either annually, or semi-annually. Addititonally, when the boards discuss and announce dividends, rather than announcing a price figure per share, they usually talk in terms of percentage (they announce they'll pay 25% of net income as the dividend), so its hard to put a specific dollar figure on what the dividend will be, until after the numbers are crunched.


On Apr 08 07:29 PM Michael Fitzsimmons wrote:

> last year, STO paid $1.65/share (US$ per share ADS).
> if StatOil were to pay the same dividend this year, the stock would
> yield 9.4% at today's closing price of $17.51.
>
> STO's dividend is difficult to analyze for three reasons:
> 1) the company is not good about publicizing ADS share dividends
>
> 2) the company usually reports dividends in Norway's currency
> 3) the dividend is paid once per year, instead of once per quarter
> as most US energy firms
>
> this throws alot of financial websites (and analysts) off. your article
> says STO yields 4.37%, but i am not sure how you came up with that
> number. STO's annual meeting is on May 19th. that is when they will
> declare the dividend for this year, and it will be paid out a few
> weeks after the meeting. i would be you a cup of coffee the yield
> will be substantially more than 4.37% if the stock is anywhere near
> today's closing price. for this reason, STO is a strong buy at this
> price, and anything near this price prior to the ex-dividend date.

Apr 08 07:39 PM

[Michael Fit...:]

statoil's past dividend, and their website actually says this, that the target 45-50% of net income on dividends and share repurchases. since the first half of 2008 was a bonanza for statoil, and since natural gas prices in europe are higher than in the US, plus the russian nat gas scare (again), i think statoil's dividend announcement in may will surprise people to the upside. statoil anywhere under $20 is a bargain.

Apr 09 07:50 AM

[bullpasture:]

Michael,
Statoilhydro has already announced the board of directors recommended dividend payment which must be ratified by the general stockholders meeting on May 19, 2009. It was contained in their website 2/17/2009 announcement of 4th quarter 2008 results and preliminary annual 2008 report. A regular dividend of 4.40 Norwegian Krones (NOK) per share AND a special supplemental dividend of an additional 2.85 NOK for a total of 7.25 Krone to be paid on May 30, 2009 (ex-dividend 5/20/2009). Using yesterday's closing price of $17.51 the current conversion factor would provide a US$ dividend of $1.0881 for a 6.214% share rate. Not Bad for a stock that should appreciate significantly in the years ahead. Last year the regular dividend was 4.20 NOK with a special supplement of 4.30 for a total of 8.50 NOK. Of course last year the stock had a much higher price in May and thus the dividend actually was smaller than this years proposed one..........


On Apr 09 07:50 AM Michael Fitzsimmons wrote:

> statoil's past dividend, and their website actually says this, that
> the target 45-50% of net income on dividends and share repurchases.
> since the first half of 2008 was a bonanza for statoil, and since
> natural gas prices in europe are higher than in the US, plus the
> russian nat gas scare (again), i think statoil's dividend announcement
> in may will surprise people to the upside. statoil anywhere under
> $20 is a bargain.

Apr 09 02:57 PM

[bullpasture:]

David H.

Nice quick review you provided here.

A piece of advice though. Generally, Canadian company stock sold on the NYSE in the US is not an ADR but rather the real thing. The difference is that the dividends are reported in C$ and payment to US owners uses the currency conversion rate at time of payment. This provides an additional opportunity to plan for growth gains by anticipating the future currency directions. For example, TRP is the US NYSE listing for TransCanada while it is traded in Canada on the Toronto exchange as TRP-T (or as referenced on the Yahoo finance site as TRP.TO). The general price difference between these two listings is essentially the currency conversion factor. For example, TRP-T closed yesterday at C$30.00 and TRP closed at US$ 24.34 with a computed 0.81 factor of CAD/USD. If you examine Yahoo CADUSD=X conversion quote page and Intraday charting, you will see that the Canadian Dollar closed yesterday with a value of 0.8088 US$. Starting in 2002 until the end of October 2007, the US$ decreased in value against the CAD$. Thus if you plot Canadian stocks (e.g. TRP.TO to TRP or SU.TO to SU) during this period, you will see that the US shares had price appreciation at a greater "rate" than the Canadian exchange shares as our dollar fell in value. Likewise, starting around July 2008 when the US$ began its strengthening run, the Canadian dollar lost value rapidly compared to the US dollar. That's why Canadian stocks bought off the NYSE, such as their popular energy and mining shares, lost value so steeply in the "waterfall" crash last autumn.

What's neat now is that a currency "play" can be had in addition to market growth appreciation when purchasing Canadian company stock. Right now the Canadian dollar will buy "only" about US$0.80. But if you believe that our future US economy will see the US dollar depreciate due to inflation induced with the massive deficits and the Fed pumping money recklessly into the market, while the exchange rate approaches parity again with the stronger Canadian economy, you can get an additional 20% gain in your US exchange stock price over the actual market gain (and perhaps even more if the Canadian dollar shoots past parity)!!! So you should now buy US shares of Canadian companies as a hedge aginst the inevitable inflation we will experience.......

Apr 09 03:49 PM

[David Hunkar:]

Hi bullpasture
Thanks for the note. Yes I know that Canadian stocks trading in the US are not ADRs. When Seeking Alpha editors changed the title name of this article they changed it to say ADR. It was just a typo.

Cheers
-David

Apr 13 11:48 PM