Oil Prices Are Rising Again and These Energy Stocks Deserve A Closer Look

Inflation in the Eurozone is picking up again and oil prices are moving higher, which can raise costs for many companies while potentially shifting the outlook for energy producers. That mix of pressure and potential opportunity is pulling attention back to global energy and oil stocks. This article walks through 3 stocks from our Global Energy & Oil Producers screener that appear particularly exposed to the latest news backdrop.

The stocks covered below are just a sample from this theme, as the full screen surfaced 62 more listed energy companies with similarly interesting stories that are not covered here. If you want to move beyond the highlights and work through the full set of ideas, head straight into the Global Energy & Oil Producers screener.

Dayang Enterprise Holdings Bhd (KLSE:DAYANG)

Dayang Enterprise Holdings Bhd is a Malaysia based offshore services company that fits neatly into the Global Energy & Oil Producers theme through its work on topside maintenance, minor fabrication and hook up and commissioning work that supports upstream oil production rather than exploring or producing oil itself. Most revenue comes from Offshore Topside Maintenance Services at about MYR406 million and Marine Charter activities at about MYR433 million, both closely linked to activity and capital spending by oil and gas operators. The stock has a market cap of roughly MYR1.68 billion, which places it firmly in the listed mid cap energy services space.

Investors looking at energy exposure tied to oil company spending rather than direct production may find Dayang Enterprise Holdings Bhd worth a closer look. The company is closely linked to offshore maintenance and marine charter work, so higher oil prices and increased upstream capex can support demand for its services. However, recent quarterly results showed declines in sales and net income that highlight how cyclical this revenue stream can be. A high dividend yield and solid profit margins add appeal, although weak dividend cover and reliance on external borrowing raise questions about resilience if oil activity slows or credit tightens. The mix of cycle sensitivity, income potential and governance quality makes the next phase of Dayang’s story important to watch.

Dayang Enterprise’s income story looks powerful on the surface, yet weak dividend cover and external borrowing could be masking the real trade off. Before you commit to the narrative, review the 3 key rewards and 1 important warning sign

Energy Services of America (ESOA)

Energy Services of America plugs directly into the Global Energy & Oil Producers theme as a contractor that builds and maintains the pipes, plants and power infrastructure that keep traditional energy flowing. The company generates most of its revenue from Underground Infrastructure Construction at about $269 million, followed by Industrial Construction at about $151 million and Building Construction at about $48 million, all in the United States. With a market cap around $220 million, it gives investors exposure to energy-linked spending at a smaller cap scale.

Energy Services of America may appeal to investors who want exposure to higher energy prices without owning a producer directly. As oil and gas activity supports midstream and upstream spending, recent results show growing sales and improving profitability. The stock trades at a lower P/E than the broader Energy Services industry, yet analysts still model strong earnings momentum, which can be powerful if that growth persists. On the other hand, net margins remain slim, dividends have been uneven and the business leans on external borrowing, so any slowdown in project work or tighter credit conditions could have a negative impact. The combination of improving fundamentals and meaningful financial risk makes this a story that some investors may choose to watch closely.

Energy Services of America is focusing on higher energy infrastructure spending, yet its slim margins and reliance on borrowing leave unanswered questions. Get the full story in the Energy Services of America financial health report

NorAm Drilling (OB:NORAM)

NorAm Drilling is a pure play on the Global Energy & Oil Producers theme, owning and operating Super Spec onshore rigs that drill horizontal wells for major exploration and production companies in the Permian Basin. The business is tightly focused on the United States, where it generated about US$106 million of revenue, giving investors direct exposure to U.S. shale drilling activity that is often sensitive to crude price moves. The stock has a market cap of roughly NOK2.0 billion, which places NorAm Drilling in the listed mid cap drilling contractor space.

NorAm Drilling gives you concentrated exposure to U.S. onshore drilling at a time when higher crude prices and steady operator budgets are supporting interest in high quality rigs. Recent results show solid revenue, ongoing monthly cash distributions and a focused fleet that management aims at long, complex wells where efficiency really matters. On the flip side, the company is highly exposed to WTI swings, carries financing risk through external borrowing and has no independent directors on the board, which raises governance questions. If you want drilling exposure that is tightly linked to the oil cycle rather than a diversified energy group, NorAm Drilling is a story worth understanding in more detail.

NorAm Drilling’s concentrated rig exposure could be masking a bigger story about cash flow resilience and balance sheet risk. Get the full picture in the analysis report for NorAm Drilling

Seeking Alternatives Beyond Energy Stocks

Fresh ideas move fast. Some stocks are building momentum while others are dropping off the radar. Scan these focused shortlists before the crowd catches on and get in early.

• Spot potential early movers with strong balance sheets before they start flying by scanning this curated list of solid balance sheet and fundamentals (439 results).
• Consider potential income opportunities by zeroing in on companies in the curated 419 dividend fortresses while yields and payout stories still look attractive.
• Explore possible future growth stories by reviewing the hand picked 618 high quality undiscovered gems while they remain under the radar for now.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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