Daily Stock Pick: Ecopetrol
A portfolio of stocks I've been building since September 3 is named Volio Folio. It will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!
Today I'm reviewing the fifth of five energy stocks striving to be picked to join my Volio folio. This could be the eleventh pick for Volio!
That energy sector includes six industries all related to bringing oil and gas to the market. They are: drilling, exploration and production (E&P), equipment and services, integrated, midstream, refining & marketing. (Yes, those are the six oily and gassy enterprises.)
My subject today is another large-cap oil & gas integrated company named, Ecopetrol SA Their trading ticker symbol is EC. This is my first report on Ecopetrol SA (EC).
Ecopetrol SA is a vertically integrated oil company with operations in Latin America and the United States Gulf Coast.
Based out of Colombia, the company explores, develops, and conducts production activities in various countries. Ecopetrol works as the primary operator or partner in a joint venture, in a host of assets held onshore and offshore.
Along with production, the company refines and markets crude oils and byproducts produced from its fields. Crude products are moved by Ecopetrol through a series of pipelines throughout Colombia, along with a network of third-party production centers and facilities.
Ecopetrol S.A. has strategic partnership with Occidental Petroleum Corporation.
The company was formerly known as Empresa Colombiana de Petróleos and changed its name to Ecopetrol S.A. in June 2003.
Ecopetrol S.A. was founded in 1948 and is based in Bogotá, Colombia.
I use three key data points to gauge dividend-paying equities or funds like Ecopetrol SA:
(1) Price
(2) Dividends
(3) Returns
Besides those three, several other keys will finally unlock an equity or fund in which to invest, or not.
Those three basic keys, however, best tell whether a company has made, is making, and will make money.
EC Price
Ecopetrol's price per share closed at $18.20 yesterday. A year ago its price was $20.63. So, in the past year, its price fell $2.43 or almost 12%.
Assuming Ecopetrol's stock trades in a range of $15 to $25 this next year, it's recent $18.20 price could rise by $0.80 and might get to $19.00 by mid-November, 2020, assuming a little more upward price momentum kicks-in.
EC Dividends
Ecopetrol's latest declared annual dividend was $0.96, paid May 3rd.
That $0.96 A dividend yields 5.30% based on yesterday's $18.20 closing price.
EC Gains?
Adding the $0.96 annual estimated dividend to my $0.80 estimate of Ecopetrol's price upside shows a $1.76 potential gross gain, per share, which will be reduced by any costs to trade these shares.
Say, for costs, we put a little over $1,000.00 today into Ecopetrol SA at its recent $18.20 price, we'd buy 55 shares of EC.
A $10 broker fee paid half at purchase and half at sale could cost us about $0.18per share.
Subtract that $0.18 brokerage cost from the estimated $1.76 gross estimated gain per share leaves a net gain of $1.58 X 55 shares = $86.90 or an 8.6 % net gain on a $1,001.00 investment.
Therefore, Ecopetrol SA, whose trading ticker symbol is EC shows a possible 8.6% net gain including a 5.30% dividend yield. It could be more, it could be less.
The above speculation is based on past year performance. The actual results remain to be seen to learn if Ecopetrol SA is worth your time and money.
Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...
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