“Despite outperforming year-to-date, energy sector valuations still have room to grow, as measured by looking at the S&P Global 1200 Energy index. Multiples are still at a discount to their 10-year average and fund positioning is low,” said BlackRock Chief Investment Strategist Russ Koesterich in a note out Monday. “In addition, I continue to see good free cash flow and several recent investment projects are beginning to bear fruit.”
The SPDR S&P International Energy Sector ETF (NYSEArca: IPW) is an even less expensive option to consider, indicating the exclusion of U.S. stocks can bear valuation fruit for astute investors.
IPW has a price-to-book ratio of just 1.53 and a trailing 12-month yield that is 44 basis points above IXC’s, according to State Street data. Shell, Total and BP combine for 37.4% of IPW’s weight.
iShares Global Energy ETF
