Just crude oil. By then, natural gas will be the world's third-largest power-producing fuel, only to be overtaken by renewables in the late 2030s. We'll also burn more gas. We'll still need to move gas and oil to its final destination.
Enter Kinder Morgan (NYSE: KMI). It's an oil and gas corporation, but not like ExxonMobil or Shell. Kinder Morgan handles energy logistics. It owns and operates 82,000 miles of pipelines across the US to transmit crude oil, natural gas, gasoline, and carbon dioxide (which can boost well output). Kinder Morgan will be needed as long as the U.S. drills and burns gas and oil.
However, the bullish thesis hinges on this: This pipeline company's success isn't tied to oil or gas prices. Kinder Morgan's top and bottom lines aren't affected by crude oil or natural gas prices; they're based on volume and distance. Of fact, this business model supports dividends well. Kinder Morgan's dividend yield is 6.1%.
3. Berkshire Finally, consider buying Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) at less than 10 times its trailing-12-month per-share earnings.
Not a typical stock. Instead, it's a basket of Warren Buffett-selected equities and a larger collection of privately owned companies including GEICO Insurance, Duracell batteries, BNSF Railway, and See's Candies. However, Berkshire is still priced as a value company since these privately owned firms generate predictable cash flow. Two-thirds of Berkshire Hathaway's 2023 operating earnings came from private companies.
Though not the main reason to invest in this name. No dividends since Berkshire doesn't pay! Berkshire Hathaway is still the best option to maximize returns from this category of companies, so value-seeking investors may want to buy now. Warren Buffett likes more than value investment. He consistently picks the best value stocks! Berkshire's long-term market win proves it.
Bonus: Berkshire stockholders can be assured that Buffett would rather sit on unused cash than take on a new, potentially unproductive holding. Berkshire Hathaway has $167.6 billion in cash waiting for a true opportunity without seeing anything worth buying for the long term.
Berkshire shares have two variations. A shares trade around $620,000 each. If you have $500 to invest, consider B shares, which are approaching $410. Do not worry. Both tickers work similarly.
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