Top 15 Energy Stocks With the Strongest Businesses
Marvin's rules picked these 15 Energy companies by Business Quality score, which compares each company with others in its own industry. EQT, Flowco and Cheniere Energy Partners are the first three.
Energy is a broad sector. It includes gas and oil producers, equipment and services firms, pipeline and shipping companies, refiners, uranium and solar. This list shows the 15 Energy companies whose businesses score highest on Marvin's Business Quality measure.
Business Quality looks at things like profit margins, cash generation, returns and debt. Each company is judged against others in its own industry, so a score for a producer is not directly comparable with a score for a solar company. Compare the underlying figures in each write-up with that in mind.
A high score describes how a company looks today. It is not a forecast, and it does not say whether a stock is a good fit for you. Some figures are missing for certain companies, and the write-ups note this.
The list
How Marvin ranked these stocks
Marvin included companies above a minimum size and ranked the Energy sector by Business Quality score, highest first, with at most 4 companies from any one industry. Marvin scores are relative to each company's own industry, so they show how a company compares with similar businesses, not with all of Energy. Overall and Opportunity scores are shown alongside Quality, but Quality sets the order.
Companies above about $300 million in size, ranked by Marvin scores (0-100, relative to each company's own industry). The Energy sector, highest Business Quality score first; at most 4 per industry.
The stocks, one by one
EQT Corporation EQT
EQT, an oil and gas producer, has a Business Quality score of 97, backed by an operating margin of 42.5% and a free cash flow margin of 39.4%. Debt is low at 0.22 debt-to-equity. The caution: return on equity is only 10.7%, modest next to its margins.
Flowco Holdings Inc. FLOC
Flowco, an oil and gas equipment and services company, grew revenue 41.9% last fiscal year and turned 25.4% of revenue into free cash flow. The caution: debt-to-equity of 0.94 is higher than many companies here, and its operating margin is 18.8%.
Cheniere Energy Partners, L.P. CQP
Cheniere Energy Partners, a midstream company, shows an operating margin of 33.6% and a free cash flow margin of 24.2%, with revenue growth of 23.6%. The caution: return on equity, debt and gross margin are not available, so the picture of its finances is incomplete.
Uranium Royalty Corp. UROY
Uranium Royalty Corp. posted revenue growth of 1566.0% and an operating margin of {{UROY.operating_placeholder}}, with debt-to-equity of 0.62. The caution: a jump that large is unusual and says little about steady growth, return on equity is just 5.8%, and free cash flow margin is missing.
Diamondback Energy, Inc. FANG
Diamondback Energy has a Quality score of 95 and modest debt at 0.29 debt-to-equity, with revenue growth of 35.8%. The caution: its operating margin of 6.3% and return on equity of 3.9% are thin, and its Opportunity score of 59 is much lower than its Quality score.
First Solar, Inc. FSLR
First Solar has very little debt, with 0.02 debt-to-equity, plus an operating margin of 33.6% and a free cash flow margin of 27.9%. Return on equity is 16.9%. The caution: its Opportunity score of 73 is below its Quality score of 94.
Innovex International, Inc. INVX
Innovex International grew revenue 48.0% and carries little debt, at 0.09 debt-to-equity. The caution: its operating margin is a slim 10.0%, return on equity is 5.8%, and free cash flow margin is not available.
Expand Energy Corporation EXE
Expand Energy grew revenue 186.3% last fiscal year, with an operating margin of 26.9% and debt-to-equity of 0.19. The caution: its free cash flow margin of 19.7% is lower than its operating margin, and gross margin is not available.
Dorian LPG Ltd. LPG
Dorian LPG, a midstream company, has a high operating margin of 57.6% and return on equity of 26.0%, with moderate debt at 0.52 debt-to-equity. Revenue grew 36.3%. The caution: free cash flow margin and gross margin are not available.
Valero Energy Corporation VLO
Valero, a refiner, earns a return on equity of 28.8% and carries debt of 0.36 debt-to-equity. The caution: revenue changed by -5.5% last fiscal year, a decline, and the operating margin of 7.2% is thin, as is the gross margin of 8.0%.
Archrock, Inc. AROC
Archrock grew revenue 28.7% and earned a return on equity of 21.2%, with a free cash flow margin of 19.4%. The caution: debt-to-equity of 1.52 is the highest on this list, and operating margin is not available.
National Fuel Gas Company NFG
National Fuel Gas has an operating margin of 40.3%, a gross margin of 87.7% and a return on equity of 17.2%. The caution: its free cash flow margin is only 8.8%, so far less of each sales dollar becomes free cash than its operating margin suggests.
CNX Resources Corporation CNX
CNX Resources grew revenue 76.8% and earned a return on equity of 19.6%, with a free cash flow margin of 20.2% and debt-to-equity of 0.49. The caution: operating margin and gross margin are not available, so profitability is only partly visible.
Western Midstream Partners, LP WES
Western Midstream Partners has an operating margin of 41.0% and a free cash flow margin of 33.1%, strong for a pipeline-type business. The caution: revenue growth was a modest 6.6%, its Opportunity score is only 46, and return on equity and debt figures are missing.
Slb N.V. SLB
Slb has a Quality score of 88, a free cash flow margin of 13.2%, a return on equity of 11.9% and debt of 0.43 debt-to-equity. The caution: revenue changed by -1.6% last fiscal year, a small decline, and operating margin is not available.
Common questions
What does the Business Quality score mean?
It is a Marvin score that rates how strong a company's business looks compared with other companies in its industry, using measures such as margins, cash generation, returns and debt. A higher score means a stronger showing relative to industry peers today. It is not a prediction.
Why are some figures missing for certain companies?
Not every measure applies to or is reported for every company. Pipeline partnerships, for example, may not have a return on equity figure, and some companies lack a reported free cash flow or operating margin. When a figure is missing, the write-up says so and relies on the others.
Does a high score mean I should invest in the company?
No. The scores describe how a company compares with its industry today. They do not predict future results and do not say whether a stock suits your goals or risk tolerance. Treat the list as a starting point for your own research.
Keep reading
- Top 15 Energy Stocks Right Now, Ranked by Marvin Scores
- Top 20 Oil and Gas Stocks Ranked by Marvin Scores
- Top 15 Energy Stocks by Marvin's Opportunity Score
- Top 15 Oil & Gas Equipment & Services Stocks
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Marvin's scores (0-100) compare each company with others in its industry today. Growth and margin figures come from SEC filings. This is general information, not personal investment advice or a recommendation to buy or sell anything. Do your own research.