Shall you buy AGYP Stock? [With Infographic]

This story originally appeared on Best Stocks

AGYP is one of these stocks out in the market that brings bad memories to investors. That is because AGYP suffered a strong loss of its value from $165 on June 9, 2006, to $10 in just a few months; that huge selloff almost caused the company to go bankrupt.

With AGYP traded at such a “low” price, many investors wonder whether AGYP stock is one of the best stocks to buy right now. In this article, we go through the reasons why you should invest in AGYP stock.

Why Buy AGYP Stock?

The company offers excellent value, which will allow you to profit in the years to come. At $0.3 per share, there’s tremendous potential for the stock to grow even further. The company has just received NYSE approval, and now it is in a great position to grow in the future. Since it’s a limited partnership, it’s available to every investor. 

We have listed four main advantages of investing in AGYP: diversification, position in the market, dividends, and growth forecast.

1. AGYP has a diversified portfolio: The majority of its revenue comes from retail. In 2016, this accounted for 94.7% of revenue, while energy marketing contributed just 3.2%. This means they don’t rely on any industry, and their products are available nationwide.
2. AGYP has a Strong Financial Position: In 2020, they generated $155.6 million in revenue and $23.3 million in profits. They also have a strong balance sheet with assets of $1.5 billion.
3. AGYP gives annual dividends: Since they went public last year, the company has announced that it will pay out 5% of its stock price to shareholders in dividends.
4. Gaining Ground: In the future, it will be beneficial to own shares in Allied Energy because they are gaining ground in their energy marketing business.

Allied Energy Corp growth

Allied is one of the largest utility companies in Massachusetts. They have invested $1.5 billion into upgrading and building new infrastructure. The company provides electricity and water to 785,000 customers and has worked hard to provide reliable electricity and water services. This significant investment has paid off with time, and it has made Allied one of the largest corporations in Massachusetts. 

Allied Energy Corp is in the process of growing into the world’s largest distributor of electricity. In April of 2017, they agreed to purchase Eversource Energy for $3.3 billion. That was a great deal that allowed Allied Energy to expand its businesses and create more jobs. In just the last year, they’ve also created hundreds of jobs and purchased 47 enterprises. That’s a lot of good news for their customers, their employees, and for American society in general.

Recently, President Trump moved forward with the construction of the Keystone Pipeline. That’s something that has not been done in the last eight years. This, together with the acquisition of Prometheus Lease, has meant a lot for AGYP’s future.

Who is Allied Energy Corp?

Allied Energy Corp is a utility company that provides electricity, natural gas, and water to customers in the United States. They are headquartered in Boston, Massachusetts, and employ over 3,000 people. The company is diversified with investments in different industries such as retail and energy marketing. 

Allied was founded in 1817 and has managed to survive major changes in the economy over the years. It was an electrical power provider for homes, farms, and businesses in Massachusetts for over a hundred years. Nowadays, Allied provides electric service to its customers and energy marketing to wholesale customers in the United States and Canada.

Allied Energy Corp has been publicly traded on NASDAQ since 2006. The company currently operates in 25 states and the District of Columbia. With its headquarter in Houston, Texas, it has subsidiaries in Illinois, Indiana, Iowa, Louisiana, Maryland, Ohio, South Carolina, and Virginia. 

In October 2018, Allied Energy Corp’s price was $11.86 per share with a USD 1.5 billion market cap. Today AGYP is traded at -10x of that price. This company is expected to continue growing next year due to increased investments in infrastructure for natural gas distribution and electric generation facilities and an anticipated increase in demand for power for commercial industry services due to economic growth, which leads to residential customers.

How is AGYP affected by the oil price change?

Oil prices have been declining for the past two years, and there’s no end in sight. For AGYP stock, this is an opportunity, and as reported on their website: “With approximately 20% of American oil production and 10% of American natural gas production coming from marginal wells, they are America’s true strategic petroleum reserve.”

According to Investopedia, there are many factors behind the decline in oil prices, such as increased supply because of higher production from places like the U.S., Canada, Iraq, Libya, and Russia. Also, domestically, more fuel-efficient cars are on the roads due to stricter emissions requirements. This means people are driving less, which leads to less demand for gas. Less demand leads to lower prices.

As crude oil prices continue to fall, many investors and businesses are scrambling to find creative ways to take advantage of this phenomenon, which is good news for AGYP stock.

The first reason is that we live in a globalized world where it’s not just about American companies and their customers anymore. The price of oil directly impacts economies worldwide, and if there’s one thing we learned from 2008, it’s that when things go south, they tend to stay south.

Another reason is that the price of crude oil has such an immediate impact on our economy. It makes up roughly 40% of the cost of goods in America, so these are falling.

AGYP stock infographic