Our three energy ideas for the rest of 2026 are Cenovus Energy (CVE), Valero Energy (VLO), and the Vanguard Energy ETF (VDE). Each one currently carries a top “Buy” or “Strong Buy” style rating from Zacks and a “Buy” or “Moderate Buy” consensus on MarketBeat.
Energy has been one of the market's stronger sectors this year. Rather than chase the most volatile names, we focused on established, dividend-paying businesses and one low-cost fund that spreads risk across the whole sector.
Pick #1: Cenovus Energy (NYSE: CVE)
What it is. Cenovus is an integrated Canadian energy company based in Calgary. It produces oil and natural gas, with a large focus on Alberta's oil sands, and it also owns refining and marketing operations. That mix means it earns money both pumping crude and turning it into fuel.
The ratings. Zacks upgraded Cenovus from Hold to Strong Buy on September 28, 2026. On MarketBeat, 15 analysts give it a consensus rating of Buy: two Strong Buy, twelve Buy and one Hold. JPMorgan moved from Neutral to Overweight in September. (MarketBeat)
Key numbers.
- Recent price: about $31; average analyst target: $39.00
- Market value: about $57 billion; P/E ratio: about 12
- Last quarter's revenue: $14.59 billion, up 47.9% from a year earlier
- Debt-to-equity: 0.25, a conservative balance sheet for the sector
Why we like it. It is a large, profitable producer trading at a modest earnings multiple, with low debt and a shift in analyst sentiment toward the positive.
What could go wrong. Its profits depend heavily on oil prices and on the price gap for heavy Canadian crude. Oil sands projects are capital-intensive, and Canadian policy or pipeline issues can affect results. The stock has nearly doubled off its 12-month low of $15.63.
Pick #2: Valero Energy (NYSE: VLO)
What it is. Valero is one of the largest U.S. refiners. It turns crude oil into gasoline, diesel, jet fuel and other products, and also makes low-carbon fuels. Refiners earn the spread between what crude costs and what fuel sells for, so they can do well even when oil prices are not rising.
The ratings. Valero was on Zacks' Rank #1 (Strong Buy) growth list on September 30, 2026, with a Growth Score of A. The Zacks consensus estimate for this year's earnings rose 25.5% over the prior 60 days. (Zacks via Yahoo Finance) On MarketBeat, 20 analysts give it a Moderate Buy: two Strong Buy, nine Buy, eight Hold and one Sell. (MarketBeat)
Key numbers.
- Recent price: about $388
- Average analyst target: $335.13 (high: $457, Goldman Sachs; low: $195)
- P/E ratio: about 16; dividend yield: about 1.2%
- PEG ratio: 0.26, versus 0.34 for its industry (Zacks)
Why we like it. Earnings estimates have been climbing quickly, which is exactly what the Zacks Rank rewards. Several large banks raised their targets sharply in September, including UBS to $450 and Goldman Sachs to $457.
What could go wrong. The stock already trades about 13% above the average analyst target, so much of the good news may be priced in. Refining margins are cyclical and can shrink fast. This is a pick where position size and patience matter.
Pick #3: Vanguard Energy ETF (NYSE Arca: VDE)
What it is. VDE owns roughly 110 U.S. energy companies in a single trade, from Exxon Mobil and Chevron down to mid-size drillers, pipelines and service firms. It is the ETF share class of the Vanguard Energy Index Fund, so investors who prefer a traditional mutual fund can buy the same portfolio as Admiral Shares (VENAX).
The ratings. Zacks gave VDE a Zacks ETF Rank of #1 (Strong Buy) in its April 2026 review, based on expected sector return, cost and momentum. (Zacks via Yahoo Finance) MarketBeat shows an aggregate rating of Moderate Buy, built from analyst ratings on the fund's holdings. (MarketBeat) TipRanks reports a similar picture: 82 Buy, 24 Hold and 5 Sell ratings across its holdings. (TipRanks)
Key numbers.
- Expense ratio: 0.09% a year, or about $0.90 per $1,000 invested
- Assets: about $10.4 billion
- Tracks: MSCI US Investable Market Energy 25/50 Index
- Pays a quarterly distribution
Why we like it. It is the simplest, lowest-cost way to own the whole sector. If you don't want to bet on one company's execution, this spreads that risk across the industry.
What could go wrong. Diversification inside one sector does not protect you from that sector. If oil and gas prices fall, nearly everything VDE owns falls together. The largest holdings make up a big share of the fund.