Back on August 25, 2025, exactly 7 months ago today, I got a bee in my bonnet about energy stocks. 2 recurring themes in the news got me thinking. AI was everywhere – and with it came a voracious appetite for electricity, and a not-so-new theme around our aging electrical grid.
For anyone interested, you can read the original post, ENERGY COULD BE BIG.
If you’re into the whole brevity thing, my thinking was that a nice basket of energy-related companies would likely do well over the next few years. I was especially excited because energy stocks tend to pay a nice dividend. A regular quarterly payment is a bonus. It makes it much easier to hold on during the inevitable downturns.
Now granted, 8-months is a relatively short time but let’s take a look at how we’re doing.
Choosing
Before we start, a quick note on how I chose the companies in my energy basket.
I don’t know an awful lot about the energy sector. I have been a long-time shareholder of Con Edison, but I don’t feel like I’m an expert.
Given my lack of expertise, I decided to choose a basket of 8 stocks (I added an 8th after the original post) that were industry leaders, had solid analyst ratings, and represented different areas of the energy sector (Grid operators, exploration/production, transmission…)
My thinking was that the large house-hold names with solid dividends and solid analyst assessments. would likely beat an index fund with dozens of energy names like the Fidelity MSCI Energy Index ETF (FENY) or the Fidelity MSCI Utilities Index ETF (FUTY)
…And the Answer is…
I’m pretty happy, at least until I wrote this post.
My 8 companies have all beaten the IVV S&P 500 fund. And they’ve all provided some nice dividend checks. I’ve received regular dividends, which I have reinvested to buy more shares. The value of those reinvested dividends is $2,027.37.
The market (especially growth stocks) has had a rough ride over the past 8 months, and my energy picks have added a nice balance to my portfolio.
But I Was Wrong
At least a little bit…
I thought that picking 8 big-name companies would be better than picking an index.
If you look at the last 3 rows on the table, I compare my performance to 3 index funds.
I took the index fund price on 8/25/25, the index fund price today, calculated the $ difference in price from 8/25 through today, and calculated the % difference.
The energy index crushed it. The utilities not so much.
Holdings
I hate to be wrong.
Let’s dig in a bit to see what we can learn.
Here are the holdings from the 2 funds.
As you can see, more of my picks fall into the utilities fund rather than the energy fund. That’s because I was focused on the grid and power distribution more so than exploration and production. Conoco Phillips is really the only company I chose that was in the exploration and production bucket.
Now, anyone who has bought gas for their car or home heating oil in the past few weeks knows something about this.
Prices are ridiculous. I paid over $5 for heating oil – it’s up over $1 per gallon, and gas is up about 50 cents. This has been good for exploration and production companies like Chevron, ExxonMobil and Conoco Phillips.
With the late 2025 excitement in Venezuela and the 2026 war in Iran, oil prices are surging, and that’s been good for oil exploration and production companies. So, 2026 has been a good year ExxonMobil, Chevron and Conoco Phillips.
World events have created a boon for companies involved in oil exploration and production.
Wrap Up
I feel good about my energy picks. They’ve outperformed the S&P 500 and provided a nice dividend.
And while I was initially surprised (and angry) to see that an index fund beat my performance (by a long shot), I feel better now that I understand why.
My crystal ball is on the fritz, so I’ll never be able to predict the next significant global event. And these global events almost always cause huge movements in certain companies and sectors. But those movements tend to be temporary.
Oil is up over $100 per barrel, but it will most likely come down at some point. I can’t tell you when.
To me, trying to bet on short term catalysts is a losing game.
I believe that AI power needs will be a sustaining trend for many years, and our grid will need upgrades to meet increasing power demands. I may have missed a short-term spike, but I feel optimistic about my energy basket’s prospects for the next 10 years.