Dear Reader,
This is Dylan Jovine with Behind the Markets.
Happy Friday.
Today is Friday, February 13th.
You may notice I've got a globe here now. I've wanted one for a long time. I don't know why — I just like looking at it. When you talk about geopolitics all the time, it helps to actually see how things connect.
Recently I was being interviewed and trying to explain how a missile would arc from Greenland over the North Pole, and I'm sitting there using an imaginary globe with my hands… and I'm thinking to myself, I must look completely insane.
So now I've got a real one.
Anyway — today I want to talk about energy.
Energy is a big component of what we do at Takeover Targets. And right now, it's the best-performing sector in the S&P this year.
Energy stocks are up roughly 20% so far this year — compared to about 2% for the S&P.
That's a big gap.
So what's driving it?
Of course, geopolitics plays a role. War risk probably adds about $6 per barrel to oil prices.
Venezuela's assets won't be meaningfully online anytime soon. Iran tensions are escalating — we've got a carrier strike group in the Persian Gulf and possibly another one on the way.
All of that matters.
But that probably explains about $6 a barrel.
The real shift — the real driver — is something much bigger.
Investors are rotating into energy as the AI trade gets riskier.
AI used to lift all boats. Now it doesn't.
Some tech stocks are down double digits because investors are realizing AI may erode their business models instead of strengthen them.
Energy?
Energy is not getting replaced by a chatbot.
Last year, energy was one of the cheapest sectors in the market.
And you know us — we love buying good assets when they're cheap.
We talked about this in The Last Retirement Stock report — and we just updated it last Thursday.
Long before it became fashionable to say this, we were making a very simple argument:
There are energy companies that effectively get paid every time someone uses AI.
Because at its core, every tech revolution is an energy revolution.
Trains didn't spread across America without coal.
Cars didn't take off without gasoline.
AI does not scale without electricity.
It's that simple.
This next phase of AI is massively energy-hungry. Data centers. Chips. Cooling systems. Transmission.
It all requires power.
And the companies we've positioned ourselves in through Takeover Targets are directly tied to that buildout.
The best part?
Many of them are still historically cheap.
They pay strong dividends.
And they benefit from AI growth without depending on hype.
You get paid while you wait for the market to reprice them.
So if you haven't read our Last Retirement Stock report yet, make sure you check it out right here.
Anyway, that's all I have for you today.
Have a wonderful weekend.
Don't let Friday the 13th spook you too much.
I'm heading to see my daughter in her school play tonight — Seussical. I'm very excited. A bunch of friends are coming too.
Have a great weekend.
I'll see you Monday.
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