This stock has been a great pick for us. We’re back to reiterate why we think it is a winner for clients.

Below, we provide an excerpt from our latest Long Idea report. You can buy the full report a la carte here.

We’re not giving you the ticker for this pick, but this excerpt shows how thorough we are.

You need a Professional Membership or higher to view all the content on this page.

Already a member?

Learn more about our research here.

This stock presents quality Risk/Reward based on the company’s:

  • position to profit from long-term rising global energy demand,
  • “toll taker” business model that profits from volume, not price,
  • profitability near the top of the industry,
  • high unitholder return backed by ample cash flows, and
  • cheap stock price.

Fossil Fuel Consumption On the Rise

Before the closure of the Strait of Hormuz sent oil and gas price soaring, the world was consuming and producing more crude oil and liquid fuels (such as gasoline).

Even after the closure, the U.S. Energy Information Administration (EIA), in its April Short-Term Energy Outlook, projects global crude oil and liquid fuel consumption to grow by approximately 1% and 2% in 2026 and 2027, respectively. See Figure 1.

Figure 1: Global Crude Oil and Liquid Fuels Consumption: 2017 – 2027

Sources: U.S Energy Information Administration

Strong and Improving Fundamentals

Amid rising energy demand and higher volumes, this company has grown revenue and net operating profit after-tax (NOPAT) by 18% and 28% compounded annually since 2016 (earliest data available). See Figure 3.

Additionally, the company’s Core Earnings, a superior and cleaner earnings measure, grew 36% compounded annually from 2016 to 2025.

More recently, the company improved its NOPAT margin from 45% in 2020 to 51% in 2025 while invested capital turns improved from 0.2 to 0.3 over the same time. Rising NOPAT margins and invested capital turns drive the company’s return on invested capital (ROIC) from 9% in 2020 to 14% in 2025.

Figure 3: Revenue and NOPAT: 2016 – 2025

Sources: New Constructs, LLC and company filings

…there’s much more in the full report. You can buy the report a la carte here.

Or, become a Professional or Institutional member – they get all Long Idea reports.

Interested in starting your membership to get access to more of our research? Get more details here.