These 3 Dividend-Paying Energy Stocks Are Ridiculously Cheap!

Energy markets have rallied to start 2019. Learn about these three great dividend-paying stocks currently trading on the TSX Index, including Crescent Point Energy Corp (TSX:CPG)(NYSE:CPG), which is up more than 27% this month.

Energy markets have rallied to start 2019, led by the price of crude oil, which has risen from below US$50 per barrel in January to north of US$60 as of Monday’s close.

Yet, for whatever reason, some of Canada’s leading energy stocks haven’t fully participated in the rally.

These three Canadian energy stocks are not only offering investors ridiculously cheap value but also an outstanding opportunity for a relative value trade, with the hope that it should only be a matter of time before they catch up to the rest of the pack.

Shares in one of North America’s largest integrated producers, Imperial Oil (TSX:IMO)(NYSE:IMO) are currently trading near their 52-week lows and IMO stock is about the cheapest it’s been at very long time.

IMO shares have traditionally traded at a premium valuation relative to the rest to the market. A lot of that has to do with the predictable nature of the company’s business model, along with the pristine condition of its balance sheet. But at current prices, IMO shares appear to be trading outside their norms.

Imperial Oil’s current price-to-earnings ratio of 13.5 times is far cheaper than where the shares have traded historically. Its current dividend yield of 1.97% also offers more value than what the shares have historically. While the sub-2% yield isn’t going to do much for income-focused investors, IMO looks like a real solid value play these days.

Meanwhile, stock in Crescent Point Energy (TSX:CPG)(NYSE:CPG) has absolutely skyrocketed in recent weeks heading into Tuesday — up already more than 39% over its intra-month lows.

CPG recently cut its dividend to free up additional cash flows. Prior to the January announcement, the company’s shares had been trading at close to double-digit territory, so it would not be a far-reaching statement to say that some may have already been anticipating the dividend cut.

Longer term, CPG still lays claim to some of Canada’s leading medium to light oil and natural gas reserves, making the company’s current 0.35 times price-to-book ratio look like a real steal. Even though CPG recently cut its monthly dividend payout, shares have been trading at deeply oversold levels as of late.

This is a stock that could also represent a great opportunity for deep-value investors.

Cenovus Energy (TSX:CVE)(NYSE:CVE) is a company that I’ve been banging the table on for some time.

CVE stock is off to a roaring start — up just shy of 40% so far in 2019.

An investment in Cenovus right now is unquestionably a value play and some might argue a contrarian play to boot. Having doubled its available production capacity in recent years, the fact that CVE stock still trades well below its all-time highs remains a mystery to me.

This is a position I’m willing to go against the grain on.

Provided that management can continue to execute its strategy of paying down the debt that it took on to finance the ConocoPhillips assets, this is an investment that I firmly believe could offer a great deal of upside.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Jason Phillips has no position in any of the stocks mentioned.

More on Dividend Stocks

Hand Protecting Senior Couple
Retirement

These 2 Dividend ETFs Are a Retiree’s Best Friend

These two dividend ETFs could provide retirees with a diversified and stable income stream, while providing some price appreciation.

Read more »

ETF stands for Exchange Traded Fund
Dividend Stocks

How to Earn $2,000 in Passive Income in 2025 With Less Than $51,000 in Savings

You can invest in Canadian high yield stocks via the Vanguard FTSE Canadian High Yield Dividend ETF (TSX:VDY).

Read more »

monthly desk calendar
Dividend Stocks

This 7.8% Dividend Stock Pays Out Every Month

Not all monthly dividend stocks are created equal. And this top stock is certainly a strong choice for passive income.

Read more »

A worker gives a business presentation.
Dividend Stocks

Is TMX Group Stock a Buy, Sell, or Hold for 2025?

TMX Group (TSX:X) stock has been a consistent wealth-builder, generating 4,630% in total returns since 2002. Should you buy, sell,…

Read more »

Man data analyze
Dividend Stocks

2 Deeply Undervalued Dividend Stocks to Buy in November

Here are two stocks that I view as deeply undervalued this November.

Read more »

Dividend Stocks

The 2 Best Canadian Blue-Chip Stocks to Buy Now

Blue-chip stocks can be some of the best stocks to have in any portfolio. But when they're trending upwards, investors…

Read more »

Canadian dollars in a magnifying glass
Dividend Stocks

Here Are My Top 3 Dividend Stocks to Buy Now

These top dividends stocks have consistently paid and increased their dividends. Further, this trend will continue.

Read more »

dividends can compound over time
Dividend Stocks

Want a 7% Yield? The 3 TSX Stocks to Buy Today

These TSX stocks are offering high yields of over 7%, making them attractive for investors seeking steady passive income.

Read more »