These three shares from dynamic companies are worth a second look in the latter half of 2020, going into 2021.
Starting this list is the latest popular and space that is largely unproven Virgin Galactic (NYSE:SPCE). Virgin Galactic trades at less than $17.50 a share, a low entry way for a growth stock that is potentially disrupting.
The business’s strategy is not difficult. It desires to determine a spaceflight that is commercial with the capacity of competing in the emerging space tourism and travel industry. Its three aircraft that is current its beginning fleet, but inaddition it has two more under construction.
Virgin Galactic hopes to begin sending passengers into space in the half that is first of. Given the cost and high barriers to entry of this brand industry that is new Virgin Galactic’s valuation is situated nearly entirely on its vision, not what it’s making today. In fact, the company posted $0 in revenue quarter that is last.
Despite being mostly unproven, Virgin Galactic has the possible to define a industry that is new. 2021 could be per year that is volatile its plans get delayed, but the stock could extremely well double if its vision begins to be much more of a reality.
Equinor (NYSE:EQNR), formerly known as Statoil, is the oil that is largest and gas company in Norway. It is also the best-performing oil major so far this year, albeit at a negative return that is total.
Despite achieving record oil production and decent earnings and cash flow in its first quarter of 2020, Equinor fell victim to the collapse that is challenging oil and gas prices that resulted in negative free cash flow (FCF) and then to no earnings for its second quarter.
It wasn’t a quarter that is great but Equinor managed to keep its balance sheet at reasonable levels, all things considered. Its efforts to slash the dividend by two-thirds, reduce spending, and suspend share buybacks are most likely necessary to give the ongoing company breathing room to get through this downturn.
Although it looks bad now, it’s worth noting that Equinor may be the player that is dominant the North Sea, having reduced its breakeven price per barrel to allow the company to continue drilling for oil. However the North Sea is a field that is mature Equinor can’t count on forever. Its solution: offshore wind.
Equinor is an OK oil and gas company, but it might become a leading wind company that is offshore. The company’s new CEO, Anders Opedal, will take control on Nov. 2, and has pledged that renewable energy will be a focus that is main Equinor going forward.
Given Equinor‘s experience with offshore technology, its deep pockets, and its first-mover advantage into this niche renewable room, the organization seems to be one of the best-positioned oil majors to turn into a energy stock that is renewable. Equinor trades for under $16 a share at the right time of this writing.
Shares of pipeline giant Kinder Morgan (NYSE:KMI) go for under $13.50 at the right time of this writing.
Like Equinor, Kinder Morgan is an energy giant. Forty percent of natural gas consumed within the U.S. passes through its pipelines, also it has plans to build more.
Kinder Morgan’s focus on natural gas has held it mostly insulated from the volatility in power markets. The company’s use of long-term contracts gives it revenue that is predictable operating cash flow. As a total outcome, it only expects a 9% reduction in EBITDA plus an 11% decrease in distributable cash movement (DCF) for 2020, which is manageable. In fact, Kinder Morgan’s FCF is well ahead of its dividend obligation.
Management has stated it’s going to refrain from merger and purchase activity and focus on having to pay a consistent and dividend that is growing. Kinder Morgan’s dividend yields 8.1% at the right time of this writing. The truth that Kinder Morgan can back up this dividend with cash throughout a time that is challenging the gas and oil industry is a testament to its sound enterprize model. These three shares from dynamic companies are worth a second look.