John Stephenson’s Top Picks for Nov. 11, 2026

Market Call – November 11, 2026

John Stephenson, Founder & Oil & Gas Analyst, Granite Point Research

Focus: North American Oil, Gas & Utility Stocks

Top Picks: Parex Resources, Valero Energy, TransAlta

MARKET OUTLOOK:

Stock selection remains key as a stealth bear market appears to be gaining steam as tech has become more volatile. Oil equities and pipelines and utilities remain good places to weather a potential storm as the weight of the evidence appears to be shifting toward increased downside risks for equity markets.

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TOP PICKS:

Parex Resources (PXT TSX)

• Shareholder focused – share count reduced by 40 per cent over the last six years and a approximately 6.5 per cent dividend yield
• One of the least expensive names in the group – production growth, exploration success and asset optimization support the longer-term story
• Production of approximately 83 mboe/d, with the Casabe/Llanito JV adding exposure to more than three billion barrels of oil in place

Valero Energy (VLO NYSE)

• Best-in-class refiner with leading margins and a consistent record of execution through the cycle
• Added a US$10 billion buyback authorization – capital returns have been running above the 40-50 per cent of CFO payout target
• Attractive entry point

TransAlta (TA TSX)

• Strong Q3/26 – adj. EBITDA beat consensus by approximately 8 per cent despite Alberta power prices falling approximately 30 per cent YoY, and 2026 guidance is intact
• The Boreal (Keephills) data centre project with CPP Investments/Brookfield now has potential scale of up to approximately 1.6GW (vs. approximately 1GW) – a major AI-driven growth opportunity
• The approximately 700MW Centralia coal-to-gas conversion is advancing toward an early-2027 FID
• Attractive valuation at approximately 9.5 times EBITDA vs. approximately 11.5 times for its peer group

PAST PICKS: JULY 22, 2026

Surge Energy (SGY TSX)

Then: $10.18

Now: $10.50

Return: 3%

Total Return: 5%

Kelt Exploration (KEL TSX)

Then: $10.11

Now: $10.39

Return: 3%

Total Return: 3%

Highwood Asset Management (HAM TSX)

Then: $5.66

Now: $5.62

Return: 0.7%

Total Return: 0.7%

Total Return Average: 3%