Investors have extended their affinity for XLE, adding $756 million to the ETF this month, making the fund the top asset gatherer among all ETFs through the first week of December. With share prices depressed, analyst now see value in the energy patch. AltaVista Research, which researches close to 900 ETFs, has an overweight rating on XLE, making the goliath energy fund the only one of the nine sector SPDRs AltaVista currently rates as overweight.
“Profit expectations have been deteriorating rapidly as oil prices have fallen, and OPEC’s recent decision to maintain production levels is confirmation that larger supplies from America’s shale oil & gas revolution means lower energy prices–great for consumers but a threat to the long-term profitability of Energy firms. The Energy sector appears attractive in terms of valuation, but momentum isn’t currently in the sector’s favor,” said AltaVista in a note out earlier this month. [Bold Call on a Big Energy ETF]
Energy Select Sector SPDR
