Zero 2 Rich

Investing to One Million Dollars or Bust!


Yahoo Finance is my absolute favorite website for stock information. That’s the first site I use to look up stock prices, and research stocks. The most useless feature that Yahoo Finance has is the message boards. Each stock has a message board. I have gone into the message boards for a few different stocks that I own, but I have usually regretted it. The Yahoo Finance message boards are filled with trolls. People with nothing better to do than verbally attack other users. One I have visited was so filled with racist insults, that I couldn’t believe that Yahoo allowed it. In other cases, I have seen blatant spam. I have gotten no useful information from the message baords at all. I rarely bother going in them anymore.
If you do go in there, be cynical of anything you read. On many occasions, people have posted inaccurate information in the forums in an attempt to favorably affect the price of a particular stock. Better yet, don’t go into the forums at all. If most of what is being posted is garbage, and you can’t trust the rest, why waste your time?

With the price of oil stocks getting ever higher, and reports of Exxon-Mobil (XOM) making record profits, it makes sense to want to research oil stocks.
Let’s look at Exxon-Mobil as they are the big guys in the oil stocks sector. They have a PE of 10.69. That is very low! And yield is 2.10% that is pretty decent. But it kind of depends on gas prices staying where they are at. And is the government going to leave them alone, or are they going to start limiting Exxon’s profits, or levying some large taxes? Analysts say that Exxon’s annual growth over the last 5 years was 25.7%. But they are predicting annual growth of only 6.6% over the next 5 years. The PEG is 1.56, which kind of points to the stock being overpriced for future earnings growth estimates. Exxon’s debt is relatively low.
Who is #2? Looking at the holdings in the Dow Jones Energy Index, that would be Chevron (CVX). Cheron has an even lower PE of only 8.5, and a higher yield of 3.6%. The growth numbers are about the same as Exxon’s. Chevron has a touch more debt than Exxon, but still not much.
The number 3 slot in the Dow Jones Energy Indexx is much farther back. How about just investing in the Dow Jones Energy Index? It is being sold as an index fund by iShares under the symbol IYE. That way you can get a little bit of all the gas and oil comapnies.

Another way to go is invest in Canadian Energy Trusts. I currently own a couple of these: PrimeWest Energy Trust (PWI) & Pengrowth Energy Trust (PGH). I hold them in my Roth IRA. They return a good yield. They are little trickier than owning American oil stocks, but they are worth researching.

I would beware of investing too much in oil since you are investing in a very narrow sector. It all relies too much on a single product. And we have very little control over the supply and price of that product.

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