Overall, the impact of high oil prices on oil and gas stocks depends on various factors and can lead to both opportunities and challenges for investors. Valero’s robust refining capabilities position it well to capitalize on the current market dynamics. As one of the Best oil stock largest independent refiners globally, Valero operates a network of refineries with a combined capacity of approximately 3.2 million barrels daily. Plus, the sector of the industry where the company works changes the way they operate and adjust to market shifts. For example, a smaller downstream company might have more room to adjust to a shifting market where a larger midstream company might not.
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- The company’s operations encompass a wide spectrum within the energy sector, including exploration, production, refining and marketing of oil and natural gas and the manufacturing and sale of petrochemicals.
- ConocoPhillips has transformed its operations over the years to become a low-cost oil producer.
- Devon plans to return up to 70% of its free cash flow to shareholders via dividends and repurchases.
- So, not only will the top and bottom lines improve if energy rallies, but so will the balance sheet.
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This underperformance of the stock is not linked to the business side, with steadily growing oil production and solid profitability, allowing for record-breaking dividend yields. This is a list of the top oil stocks today that are trading on the NYSE, NASDAQ and AMEX. These stocks are the top movingoil stocks and may be useful for swing traders and day traders who trades oil stocks. „Many U.S. consumers have indeed faced weakening finances in 2024, but their demand for crude oil products has proved resilient,“ write Wells Fargo Investment Institute analysts Mason Mendez and John Laforge. „After a soft start to the 2024 driving season, U.S. crude oil demand has improved and is now in-line with its typically strong seasonal pattern.“
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This long-term evolution is a necessity in the age of climate change, and it will ensure Equinor remains a significant energy producer while also reducing its net group-wide carbon emissions. Not to mention, it aims to achieve those goals while still producing reliable and affordable energy.
- He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.
- The real question is whether or not an upstream energy stock is the right choice.
- Notwithstanding its historical dominance in the oil sector, ExxonMobil was crushed during the pandemic.
- As a refinery versus an energy exploration company, Valero is more dependent on the “spread” between unrefined oil and higher-valued refined products that it takes to market.
- Price in January established a new high after breaking above the early July resistance area.
Best Online Brokers for Oil Stocks
And even after a hot start to 2021, shares still look compellingly valued. As for valuation, FANG changes hands at 7.9 times analysts‘ 2022 earnings estimate. They expect the company to deliver average annual EPS growth of 3% over the next three to five years, per S&P Global Market Intelligence. With an average price target of $30.35, the Street gives this oil stock implied upside of about 38% in the next 12 months or so.
With an average target price of $41.57, analysts give WLL implied upside of about 13% in the next 12 months or so. Shares trade at 8.2 times analysts‘ estimated earnings for 2022, according to S&P Global Market Intelligence. The Street’s projected long-term EPS growth rate stands at 19% over the next three to five years. Pioneer Natural Resources (PXD, $148.58) is another one of analysts‘ favorite oil stocks in the independent E&P sector. PSX is widely considered among the pros to be one of the best oil stocks to buy now.
While oil stocks performed poorly last year, they could bounce back in 2025. Devon Energy (DVN -0.07%), ConocoPhillips (COP 0.96%), and Chevron (CVX 1.42%) stand out to a few Fool.com contributors as the smartest ones to buy in the new year. Here’s why they think these oil stocks could deliver standout performances in 2025. There’s nothing wrong with ConocoPhillips if you want to own an upstream energy stock.
This is why Mizuho analysts found it easy to keep a valuation of up to $70 a share of the stock as of December 2024. To prove this view right, Occidental Petroleum stock would have to stage a rally of up to 38.8% from where it trades today, giving investors their fair share of a value play. ServiceNow, Inc. provides end to-end intelligent workflow automation platform solutions for digital businesses in the North America, Europe, the Middle East and Africa, Asia Pacific, and internationally.
The company derives most of its income from royalties on the oil produced, with 1/3 of revenues from water and other surface activities revenues. And while the TPL’s current valuation certainly reflects the shale oil boom, it is not all the value of the land it owns. It can notably use this land for power generation (solar, wind, etc…), usage right (pipelines, roads), grazing, hunting, and water rights.
Aside from the Permian Basin, the company will invest in the Gulf of Mexico and DJ Basin, where it is ramping up some deepwater growth projects. For example, Chevron expects to boost production in the Gulf of Mexico by almost 50% by 2026. In between, Chevron is confident about closing its $52 billion all-stock acquisition of Hess in the near future, having received an antitrust-review clearance from the Federal Trade Commission in September last year. As a case in point, energy prices have been weak of late, and so, too, has ConocoPhillips‘ stock price. Most investors will be better off with a more diversified approach if they want to own an oil stock. That’s great when energy prices are strong, but it is terrible when energy prices are weak.
Top Oil Stocks
BP provides nearly three times the dividend yield of the S&P 500 index, as measured by popular S&P 500 Index tracking fund Vanguard 500 Index (VFIAX). And BP has a rock-bottom price-to-earnings ratio, which makes it a real bargain right now. It is smaller than Shell but still ranks as one of the most dominant energy stocks in the world. It also stands out because of its qualitative strength, not just its size. Of the 23 energy sector stocks in the S&P 500, only two—Marathon Petroleum (MPC) and Targa Resources (TRGP)—have performed as well as or better than the benchmark index year-to-date.
ConocoPhillips’s growing cash flow and cash returns should help give it the fuel to outperform its peers this year if oil prices continue to meander along in the $70-a-barrel range. Another integrated oil and gas company based in Calgary, Cenovus Energy focuses primarily on its oil sands assets. It also engages in producing conventional crude oil, natural gas, and natural gas liquids in Alberta. The company’s stock is riding on tremendous momentum, and when you look closely at the company, you’ll see its positive growth isn’t undeserved. Canadian Natural Resources has an incredibly diverse portfolio of oil products, including light and heavy crude oil, natural gas, bitumen, and synthetic credit oil. Devon plans to return up to 70% of its free cash flow to shareholders via dividends and repurchases.
If Chevron wins, it will be able to close its acquisition of Hess, which would significantly enhance its already robust long-term growth profile. While the company may lose its arbitration case, there’s reason to believe it will emerge victorious. In the past few months, Diamondback closed a $2.2 billion deal for QEP Resources and acquired assets of privately held Guidon Energy for nearly $1 billion. S&P Global Market Intelligence surveys analysts‘ stock recommendations and scores them on a five-point scale, where 1.0 equals a Strong Buy and 5.0 is a Strong Sell.
The Street expects the company to generate average annual earnings per share (EPS) growth of 7.8% over the next three to five years. Given that outlook, PSX’s valuation – trading at 11.7 times estimated earnings for 2022 – appears eminently reasonable. The independent oil refiner gets a solid consensus Buy recommendation on Wall Street. Sweetening the deal, this oil stock sports a generous dividend yield to boot.