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Investing in Shale: 3 Stocks to Keep an Eye on Before the 2024 Election Investing in Shale: 3 Stocks to Keep an Eye on Before the 2024 Election

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The prospect of fracking’s resurgence looms on the horizon, contingent upon the political winds shifting in 2024.

Tackling energy production through hydraulic fracturing, commonly known as fracking, involves the high-pressure injection of fluids underground to extract oil and gas. While heralded for bolstering domestic energy output in the U.S., fracking has triggered environmental debates. The method’s omnipresence in the energy arena has morphed into a polarizing political battleground. Under the Trump administration, fracking witnessed a zenith, only to witness a stark reversal under the Biden administration. With the possibility of a new presidency later in the year, investors are wise to keep a close watch on these three shale stocks pre-2024 election.

While certain locales have imposed bans on fracking due to environmental apprehensions, the overarching federal stance toward the practice dictates the industry’s trajectory. Thus, the fate of the sector hinges on governmental energy priorities, regulatory dynamics, and public sentiment. Despite technological strides that address environmental misgivings, the essence of resource extraction in the U.S. invariably boils down to political resolve.

Baker Hughes (BKR)

The Baker Hughes (BKR) sign and office building in Houston, Texas.

Source: JHVEPhoto / Shutterstock.com

Part of America’s oilfield services elite, Baker Hughes (NASDAQ:BKR) caters primarily to the oil and gas sector. The company’s repertoire spans a vast oilfield services array, with its equipment and digital technologies standing out for enhancing operational effectiveness and safety.

Emphasizing sustainability, Baker Hughes adopts an eco-friendly approach within the fracking realm. For instance, BKR’s utilization of modular gas processing to capture well exhaust gas instead of flaring it demonstrates operational efficiency. This captured gas becomes a highly efficient power source for the extraction process, cultivating a favorable image for potential changes in fracking regulations.

Notably, Baker Hughes maintains financial resilience even during fracking recessions. Its robust revenue growth stems from adept customer relationship management within the industry.

Halliburton (HAL)

The Halliburton (HAL) logo on the website homepage. HAL stock price prediction.

Source: Casimiro PT / Shutterstock.com

A prominent figure in the fracking sphere, Halliburton (NYSE:HAL) emerges as a prominent player with deep technological roots dating back to the 1940s when it pioneered patented fracking technology. Offering a gamut of fracking services from pressure pumps to fluid design, HAL stands poised to benefit the most from regulatory relaxations under a new administration.

Despite scrutiny over the “Halliburton Loophole,” an exemption shielding fracking fluids from oversight, the company navigates murky waters, anticipating profits upon a potential governmental policy shift.

Consistently surpassing earnings projections, HAL concluded Q4 FY2023 with $5.7 billion in revenue and an 18% operating margin. For investors eyeing substantial returns post a presidential transition, Halliburton holds promise.

Patterson-UTI Energy (PTEN)

Patterson-UTI energy logo on a screen.

Source: Piotr Swat / Shutterstock

Evolving through mergers, Patterson-UTI Energy (NASDAQ:PTEN) has emerging as a significant player in oilfield services. A lucrative segment focuses on offering products and services supportive of hydraulic fracturing activities, managing well completion processes post-fracking for enhanced well productivity.

By positioning itself as a holistic well lifecycle solution provider, PTEN’s indispensability in the industry is paramount. The company’s sturdy financial performance in recent years, coupled with a market cap of $4.87 billion and a price-to-earnings ratio of 13.55, renders PTEN stock attractively priced. Yielding a current 2.68% dividend, PTEN holds promise for sustained growth should fracking regulations ease.

PTEN’s multifaceted contributions to the fracking sector make it a stock to watch keenly before the 2024 election. Its diversified portfolio fortifies stability amidst the volatile realm of resource extraction, positioning it as a key player in the shale stocks landscape.

On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Viktor Zarev is a scientist, researcher, and writer specializing in elucidating the complex realm of technology stocks with a commitment to precision and comprehension.