Energy stocks are important for investors to understand because the energy sector is vital to the global economy. It produces and supplies the fuels and electricity needed to keep the economy humming.
Best energy sector stocks to buy in 2026
Hundreds of public companies focus on the production and distribution of energy. However, a few leaders stand out because of their size and financial strength. Here are five of the best energy stocks to consider buying in 2026:
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| Brookfield Renewable (NYSE:BEPC) | $7.1 billion | 3.79% | Independent Power and Renewable Electricity Producers |
| Enbridge (NYSE:ENB) | $107.4 billion | 5.47% | Oil, Gas and Consumable Fuels |
| ConocoPhillips (NYSE:COP) | $127.0 billion | 3.09% | Oil, Gas and Consumable Fuels |
| Chevron (NYSE:CVX) | $344.7 billion | 4.00% | Oil, Gas and Consumable Fuels |
| NextEra Energy (NYSE:NEE) | $183.6 billion | 2.57% | Electric Utilities |
Here’s a closer look at some of the best energy stocks in the industry:
1. Brookfield Renewable
NYSE: BEP
Key Data Points
Brookfield Renewable (BEP +4.85%)(BEPC +5.90%)is a leading global renewable energy producer. It operates hydroelectric, solar, wind, and energy transition assets. The company sells the power produced by these assets under long-term fixed-rate power purchase agreements (PPAs) to electric utilities and other large power users.
The contracts enable Brookfield to generate relatively steady cash flows. It pays out a large portion of that money to investors via an attractive dividend. The company retains the balance to acquire, develop, and expand its renewable energy operations.
Brookfield Renewable has an enormous backlog of renewable energy development projects. Combined with other growth drivers such as acquisitions and higher power prices, Brookfield expects to increase its funds from operations (FFO) per share by more than 10% annually through 2030. That should support a 5% to 9% annual dividend growth, making Brookfield an excellent renewable energy dividend stock.
2. ConocoPhillips
NYSE: COP
Key Data Points
3. Chevron
NYSE: CVX
Key Data Points
NYSE: NEE
Key Data Points
Capital
5. Enbridge
NYSE: ENB
Key Data Points
How to invest in energy stocks
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Renewable energy stocks
These companies manufacture components to produce electricity using renewable resources such as solar, wind, hydroelectric, and geothermal power. They also include companies that operate and develop renewable energy-generating facilities.
- Solar energy stocks: This subgroup of renewable energy focuses on manufacturing solar panels and components to generate electricity from the sun.
- Wind energy stocks: This subgroup focuses on manufacturing wind turbines and blades.
- Hydrogen stocks: These companies focus on producing hydrogen, a potentially emission-free fuel that could replace some fossil fuels in the energy industry.
Oil and gas stocks
These companies focus on finding, producing, transporting, storing, refining, and exporting fossil fuels.
- Oil stocks: Oil companies focus on locating, producing, transporting, and refining crude oil.
- Natural gas stocks: Natural gas companies concentrate on finding, producing, transporting, and exporting natural gas.
- Liquefied natural gas stocks: Liquefied natural gas (LNG) companies develop and operate facilities to liquefy and export natural gas.
- Refining stocks: Refining companies process crude oil into refined petroleum products such as gasoline, diesel, and jet fuel.
- Pipeline stocks: Pipeline companies operate pipelines and other infrastructure used to transport, process, store, and export energy products
Utility stocks
- Utility stocks: These companies generate power and distribute electricity, natural gas, and water to customers.
- Electric utility stocks: Electric utility companies generate and distribute electricity to customers.
This broad industry is crucial to providing the economy with the energy it needs. It's also an important one for investors to understand.
Pros and cons of investing in energy stocks
Investing in energy stocks has its share of benefits and drawbacks. Some of the positives include:
- Growth: Energy demand is growing, especially for lower-carbon energy such as natural gas and renewables.
- Income: Many energy stocks pay high-yielding and steadily rising dividends, making the sector a good spot to collect passive income.
- Inflation hedge: Energy prices tend to rise as inflation increases, making the sector a good hedge against inflation.
On the other hand, the sector has some potential negatives, including:
- Volatility: Energy prices can be very volatile, which can significantly impact energy stock prices.
- Geopolitical risk: The energy industry is susceptible to geopolitical risks from OPEC policy changes, economic sanctions on oil-producing countries, and shifting government energy policies.
- Climate change: Growing climate change concerns could impact demand for fossil fuels in the future.
Are energy stocks right for you?
The energy sector is vital to the global economy because it provides the fuel and power needed to drive trade and travel. However, when the economy slows, it can have a major impact on energy demand and prices. That can put significant pressure on energy stock prices.
The best energy stocks to buy are those that can easily survive a downturn and thrive when market conditions improve. Energy stock investors should also consider putting more attention on cleaner energy companies using renewable sources. The world is steadily transitioning to cleaner fuels to ensure we avoid the worst possible impacts of climate change.
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