Even if they go mostly unnoticed, energy businesses are the backbone of our country, providing the energy we need to power our lives and businesses. They are also bound to benefit from a friendlier regulatory environment with the “American energy dominance” stance of the Trump administration, and this excitement has led to a six-month gain of 19.7% for the sector - higher than the S&P 500’s 9.3% return.
Nevertheless, investors must be mindful as the cycle can unexpectedly turn. When this inevitably happens, only the elite companies will survive and ultimately thrive. Keeping that in mind, here are two energy stocks we think can generate sustainable market-beating returns and one we’re swiping left on.
One Energy Stock to Sell:
Bristow Group (VTOL)
Market Cap: $1.28 billion
Operating what's essentially an airborne taxi service for some of the world's most remote workplaces, Bristow Group (NYSE: VTOL) operates helicopters that transport workers to offshore oil and gas platforms and conduct search and rescue operations.
Why Do We Pass on VTOL?
- Muted 6.1% annual revenue growth over the last five years shows its demand lagged behind its energy upstream and integrated energy peers
- Subscale operations are evident in its revenue base of $1.53 billion, meaning it has fewer distribution channels than its larger rivals
- Low free cash flow margin of -0.1% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
Bristow Group’s stock price of $40.67 implies a valuation ratio of 5.8x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including VTOL in your portfolio.
Two Energy Stocks to Watch:
Chevron (CVX)
Market Cap: $367.4 billion
Operating everything from deepwater drilling rigs to corner gas stations, Chevron (NYSE: CVX) explores for, produces, and transports crude oil and natural gas, then refines that crude oil into gasoline, diesel, and other petroleum products.
Why Are We Positive on CVX?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 4.1% annual sales growth over the last ten years
- Dominant market position is represented by its $190 billion in revenue and gives it fixed cost leverage when sales grow
- Free cash flow generation is better than most peers and allows it to explore new investment opportunities
At $165.78 per share, Chevron trades at 10x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Gevo (GEVO)
Market Cap: $349.1 million
Operating one of the largest dairy-based renewable natural gas facilities in the United States, Gevo (NASDAQ: GEVO) produces sustainable aviation fuel and other renewable hydrocarbon fuels from plant-based feedstocks like corn.
Why Could GEVO Be a Winner?
- Annual revenue growth of 19% over the past ten years was outstanding, reflecting market share gains this cycle
- EBITDA profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
Gevo is trading at $1.47 per share, or 11x forward EV-to-EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
