1. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 86
Exxon Mobil Corporation (NYSE:XOM) tops our list of the best American stocks to buy from the Energy sector. It is an integrated oil and gas company that conducts global oil exploration, production, and refinement. It generated 7.7 billion cubic feet of natural gas per day and 2.4 million barrels of liquids in 2023. Reserves were 16.9 billion barrels of oil equivalent at the end of 2023, with liquids accounting for 66% of total reserves. The company is one of the world’s largest refiners, with a total global refining capacity of 4.5 million barrels of oil per day, as well as a major producer of commodities and specialty chemicals.
Exxon Mobil Corporation (NYSE:XOM) is still dedicated to oil and gas, even though many of its competitors are shifting investments to renewables in order to meet long-term carbon intensity reduction targets. It has declared emission reduction objectives and reacted to requests to include more external voices on its board. Along with investing in low-carbon technologies, it maintains oil and gas production as the primary focus of these measured efforts. Although investors who care about the environment are unlikely to applaud this approach, it has a higher chance of success and is likely to be less risky.
Industry-leading Q3 earnings of $8.6 billion and substantial year-to-date free cash flow of $26.4 billion with operating cash flow growth of 10.06% YoY demonstrate financial resilience in the face of weaker refining margins. Record liquids output of 3.2 million barrels per day was attained, bolstered by sales of high-value products and $11.3 billion in structural cost savings since 2019. Exxon Mobil Corporation (NYSE:XOM) is positioned as a leader in the energy transition due to its leadership in hydrogen and carbon capture programs, with a $30 billion market opportunity by 2030.
Ken Fisher’s Fisher Asset Management was the largest shareholder in the company from among the funds in Insider Monkey’s database. It owns 29,197,557 shares worth $3.43 billion as of Q3.
Overall, Exxon Mobil Corporation (NYSE:XOM) ranks first on our list of the best American stocks to buy. While we acknowledge the potential for XOM to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than XOM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. 10 Best American Energy Stocks To Buy According to Hedge Funds is originally published on Insider Monkey. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
