Buy Hold Sell: 3 energy stocks analysed

The energy sector has surged on macro shocks and big demand, but which ASX stocks are showing real staying power.

In this episode of Buy Hold Sell, Livewire’s Tom Stelzer is joined by Dougal Maple-Brown from Maple-Brown Abbott and Stephane Andre from Alphinity Investment Management to see if they’re positive or negative on some interesting ASX energy names.

In a rare turn of events, we’ve also got a double fundie stock pick. Find out which stock has got the joint tick of approval and why.

This article was first published on Livewire Markets on 1 July 2026

Transcript

Tom Stelzer: Hello and welcome to Livewire’s Buy Hold Sell. I’m Tom Stelzer. Energy stocks have been front and centre recently with the war in Iran and the demand from AI the major driving factors. But which energy stocks are showing real staying power and which could short circuit? To help make those calls, I’m joined by Dougal Maple-Brown from Maple-Brown Abbott and Stephane Andre from Alphinity. Guys, thanks for joining us.

Is there any fuel left in the energy trade?
Before we get to the stocks, I’ve got a question for each of you. Stephane, I might come to you first. After the recent run in energy stocks – I think the sector’s up 11% year to date – is there any fuel left in the tank here?

Stephane Andre: It’s quite incredible what has happened. The oil price is back to its pre-war level, it unwound very quickly. Unless you start seeing a flaring of the conflict in the Middle East, which is certainly not a base case scenario, but certainly a possibility, in which case then you’ll have an oil price which would be supported quite strongly. It has been quite tame in the upswing because the strategic reserves were released.

Now, if the Strait stays closed, you would certainly have more upside pressure to the oil price, but that’s not our base case scenario. In the base case scenario that the Strait is open, then you actually have quite a lot of LNG and oil coming in over the next few years and you feel like that would mean demand/supply is capped and the prices are capped too. So hard to see a lot of upside from here.

Picking the energy winners from the losers
Tom Stelzer: Dougal, Stephane’s touched on the big macro factors influencing the energy sector at the moment, but how hard is it to pick the winners from the losers right now?

Dougal Maple-Brown: Yeah, thanks, Tom. I think it’s particularly hard. The oil price is up and down with the US president’s tweet. That’s pretty hard to get your head around on a daily, weekly, monthly basis. And so we, like Stephane, look to the longer term fundamentals.

On data centres, everyone’s got these great spreadsheets of what demand could look like. And of course that’s a possibility, but what it actually turns out to be in the fullness of time, who frankly knows. So I think it is pretty difficult for the energy space at the moment.

Woodside Energy (ASX: WDS)
Tom Stelzer: Dougal, I’ll come back to you. We’re going to get to the stocks now – we’re going to start with Woodside Energy. Obviously we’ve mentioned that oil prices dropped after the Strait of Hormuz reopened, but what’s your call on Woodside? Is that a buy, hold or sell?

Dougal Maple-Brown (BUY): Woodside’s a buy for us in that space. We think valuations are reasonable. Woodside has quite a diversified portfolio, arguably even more valuable today, given they have limited or in fact zero exposure to the Middle East. So the ex-Middle East energy assets in our view will be worth more going forward. And finally, they’ve also got a gas trading business effectively, which we didn’t give a lot of credence to. But again, I think in the new world, that business will be worth more going forward than it has been historically.

Tom Stelzer: Stephane, Dougal touched on it there – it’s across oil and gas, I think it’s up 18% year to date – are you a buy, hold or sell on Woodside?

Stephane Andre (HOLD): We own it, but we are a hold at this stage. So I agree absolutely with Dougal’s points. The value which has been increased because of its location and with Asia, which wants to diversify away from the Middle East. The new CEO will probably also have some cost cuts and streamlining and more efficiencies to come. However, where we are a bit more prudent on the stock is we still think that there’s earnings downgrades to come because of that correction in the oil price where the market’s sitting a bit high. Also, the domestic revenues haven’t been great.

There’s been some weakness on price and volume. Medium term, we’re concerned about that LNG lift, which would mean that you might have a nexus of supply and therefore a lower realised price. And longer term, probably not on the horizon now, but we are a bit nervous about the discussions on Browse, which we think is a project which has been challenged for many years in that they are thinking of reinitiating quite a lot of water to flow through first before that happens, but we don’t really like that project at this stage.

Paladin Energy (ASX: PDN)
Tom Stelzer: A slightly different energy sector now, Stephane, I’ll stay with you. It’s Paladin Energy. Are you a buy, hold or sell there?

Stephane Andre (SELL): Sell. Uranium is a commodity that we like. Actually, we can see quite a lot of demand upside and the AI aspect, on top of normal demand, is certainly fueling more upside in terms of demand. Demand is expected to grow faster than supply with a widening deficit over the years. The cash costs are also lifting. So all the fundamentals are there from a commodity perspective.

However, the company has had quite a lot of operational downgrades over the years. We think that the expectations for FY27 are still too high from a production perspective and also from a unit cost perspective, which will probably end up higher than what the market is thinking. The Patterson Lake project in Canada is meeting quite a lot of resistance and we think that one is a project which could be pushed to the right too. But from an earnings perspective, which is what we really look at, we think there’s more downgrades, so it’s a sell.

Tom Stelzer: Dougal, obviously Stephane’s mentioned it there. There’s the demand for uranium up. I think the company is back in profitability now, but what’s your call on Paladin?

Dougal Maple-Brown (SELL): Yeah, thanks, Tom. I actually agree with almost everything Stephane said in this one. So we’re a sell, we’re not there. In fairness to Paladin, it is investible and some of the companies in that space are frankly not. It is producing and yes, it is profitable. So it ticks the basic boxes, but no, we don’t get there either. So it’s a sell.

Worley (ASX: WOR)
Tom Stelzer: And the last stock we have is something slightly different. It’s Worley, the professional services and engineering company, Dougal, I’ll stay with you. Is that a buy, hold or sell?

Dougal Maple-Brown (SELL): Yeah, it’s a sell for us, Tom, and I have to say this is now starting to look more interesting. I won’t give you my full life story, but I’ve got too many scars on my back from contractors. So we’ve got a very high bar to buy something like Worley.

So why is that? In our experience, again, some of this has been learned the hard way. With these contractors, you seem to have a period where they’ve got a whole lot of really good contracts, which sounds great, but it actually means they’re over-earning and there’s an earnings hole around the corner, so that’s not great. Or alternatively, you’ve got a whole lot of problem contracts which are losing money and taking up management time and are troublesome.

In our experience, it is very, very hard in the contracting space to thread that needle and get the Goldilocks scenario. They’ve had another downgrade a week or two ago so you want to buy these things really, really cheap. I’m not saying never, but today it’s not cheap enough for us, so it’s a sell.

Tom Stelzer: Stephane, I think it’s down 11% year to date. What’s your call on Worley?

Stephane Andre (SELL): It’s also a sell and I completely sympathise with Dougal’s comments. It’s cheap, but we think cheap is not enough. We need to see earnings upgrades. And for the moment, the problem with the company – it’s managing the situation well, but you’ve had a lot of projects that have been pushed to the right or cancelled. When you had Liberation Day and a lot of concerns in terms of global growth – that had an impact on projects. The chemical world is also a bit under pressure. Green energy – which is an area where they were equally strong on – the economics are far more challenging. Now the war in the Middle East is also pushing some of the projects. We need to really see the expectations being rebased in order for the company to be a positive surprise and for us to get interested in that company, and see that it goes back into a positive earning cycle, but we’re not there yet.

Tom Stelzer: We’ve also asked our guests to bring one energy stock they think has legs for the next 12 months. Stephane, I might come back to you. What do you have for us?

Ampol (ASX: ALD)
Stephane Andre (BUY): Ampol is a stock that we like. I think it’s benefiting from a lot of positive earnings surprise drivers. Refining margins are certainly well supported after disruptions on the refining capacity and in some cases, the destruction of it. But it also highlights the strategic importance for the government to support the industry and that means a higher floor in case these companies are running under pressure. But it will also bring new opportunities like storage in order to lift the strategic reserves of the country for fuel as well as products. And that’s something where a company like Ampol can actually play into that and have commercial agreements which are infrastructure-like and that lifts the earnings PE or the multiple for that stream. And lastly, we really like the EG acquisition. It’s a well-known entity for Ampol. It has a good value proposition and we think that the synergies are conservative for the moment and will surprise on the upside. So for us, it’s a buy because of all these earnings drivers.

Tom Stelzer: Dougal, Stephane’s given us Ampol there. What have you got for us?

Ampol (ASX: ALD)
Dougal Maple-Brown (BUY): Yeah, Tom, the punchline here is Ampol is my pick as well. This wasn’t rigged. I didn’t know he was going to say that, so it leaves me with little to say. So obviously I agree with everything Stephane said. Maybe I’ll add two points. First of all, its valuation, which as value investors, is where we start and end. On our numbers this year, the stock’s on a single digit PE. Now refining margins are inflated this year, but even in next year where we have them coming back a fair way, we still have it on 10 or 11 times, and in the current market, that looks exceptionally good value to us. The second point I’ll make on the refiner. Just for your viewers, Tom, we’re down to two refiners in this country now and Ampol are the owners of one of those up in Queensland.

Not that long ago, people and myself included thought refiners were dirty, literally, CapEx intensive, fixed cost, highly cyclical businesses, so not that attractive and that was reflected in the rating that Ampol enjoyed or didn’t really enjoy historically. I think that’s changed – possibly permanently. Those assets, as Stephane alluded to, now have arguably national interest, definitely important for fuel security and in fact, the government is going to effectively underwrite them going forward. So we believe not only the earnings upgrade that Stephane refers to, but the rating on the stock should also improve as people reappraise the importance of that refinery.

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