Energy stocks appeal to investors for a few different reasons:
- Energy stocks tend to perform independently of other types of stocks, so investors buy them to diversify their portfolios.
- Many energy stocks offer attractive yields and therefore appeal to investors who like high-dividend stocks.
- They provide investors with a way to play rising oil prices.
- Energy stocks can help hedge against inflation, as oil and gas prices typically rise during inflationary periods.
These were the most undervalued energy stocks that Morningstar’s analysts cover as of July 22, 2025.
This post originally appeared at Morningstar.