With corporate earnings season kicking off, now may be the time to look into some shares of beaten down energy stocks. While it does seem at odds to buy into earnings that will no doubt be disappoint, it could be the beginning of some green shoots in the sector.
Discounting the obvious, earnings may provide better entry points for some companies. As a whole the unexpected could come from an amalgamation of production and Capex cuts which could provide the gesture wanted from OPEC as well as limit the future production that will be available stemming demand now for storage. As long as production isn't increased to meet this demand, we could see a leveling off of both the commodity and energy companies.
When looking at increased volatility during energy earnings announcements, keep an eye out for the bigger picture in terms of future capacity and investment.