10 Most Undervalued Large Cap Stocks To Invest In

5. ConocoPhillips (NYSE:COP)

Forward Price-to-Earnings Ratio: 11.52

Number of Hedge Fund Holders: 72

ConocoPhillips (NYSE:COP) is a global independent exploration and production company focusing on exploring, developing, and producing oil and natural gas resources. It’s committed to responsible energy practices and strives to meet the growing global demand for energy while minimizing environmental impact. In 2023, it secured access to a regasification terminal in the Netherlands for importing LNG. It also committed to buying 5 million tons of LNG annually and invested in a new LNG export facility in the US.

ConocoPhillips (NYSE:COP) has signed agreements to buy LN from two projects in Mexico. It also bought Concho Resources during a difficult time for the oil industry. This created a combined oil reserve of about 23 billion barrels. It’s using natural gas to help reduce greenhouse gas emissions and ensure energy security.

There’s an ongoing merger between ConocoPhillips (NYSE:COP) and Marathon Oil (MRO). MRO shareholders approved the merger, which is valued at $22.5 billion, including ~$5.4 billion in net debt. The deal is expected to close in late Q4 2024, pending regulatory approval and customary closing conditions

The company has been financially stable for a long time because of its structured approach. During the 2020 recession, many other oil companies took on more debt, but this company stayed financially healthy. In Q2 2024, it had adjusted earnings of $1.98 per share. It generated $14.14 billion in quarterly revenue, up 9.72% year-over-year.

The company’s ability to navigate market challenges, generate consistent cash flow, and return value to shareholders demonstrates its resilience and adaptability. Despite potential headwinds from global economic conditions and geopolitical factors, its diversified portfolio and strong operational execution suggest a promising future outlook.

Diamond Hill Large Cap Strategy stated the following regarding ConocoPhillips (NYSE:COP) in its Q2 2024 investor letter:

“Other bottom contributors in Q2 included CarMax, Target Corporation and ConocoPhillips (NYSE:COP). Shares of oil and gas exploration and production company ConocoPhillips declined against a backdrop of lower oil prices in Q2, as well as concerns about the expensive though strategically sound acquisition of Marathon Oil.”