5 Best Undervalued Energy Stocks to Buy According to Analysts

In this article, we will discuss the 5 best undervalued energy stocks to buy according to analysts. If you want to explore similar stocks, you can go to 11 Best Undervalued Energy Stocks to Buy According to Analysts.

5. Devon Energy Corporation (NYSE:DVN)

Number of Hedge Fund Holders: 55

Average Analyst Price Target as of April 5: $67.71

Average Upside Potential as of April 5: 26.49%

PE Ratio (TTM) as of April 5: 5.87

On March 10, Mizuho analyst Nitin Kumar revised his price target on Devon Energy Corporation (NYSE:DVN) to $71 from $82 and maintained a Buy rating on the shares. As of April 5, Devon Energy Corporation (NYSE:DVN) is trading at a PE multiple of 5x and is one of the best undervalued energy stocks to buy now according to analysts.

Over the past 3 months, Devon Energy Corporation (NYSE:DVN) has received 9 Buy ratings and 8 Hold ratings from Wall Street analysts and has a consensus Buy rating. The stock has an average price target of $67.71, which implies an upside of 26.49% from current levels.

At the close of the fourth quarter of 2022, 55 hedge funds were long Devon Energy Corporation (NYSE:DVN) and disclosed stakes worth $823.5 million in the company. Of those, Yacktman Asset Management was the top stockholder and held a stake worth $172.5 million.

4. Diamondback Energy, Inc. (NASDAQ:FANG)

Number of Hedge Fund Holders: 52

Average Analyst Price Target as of April 5: $173.06

Average Upside Potential as of April 5: 21.04%

PE Ratio (TTM) as of April 5: 5.81

Diamondback Energy, Inc. (NASDAQ:FANG) was spotted on 52 hedge funds’ portfolios at the end of Q4 2022 that disclosed positions worth $1.11 billion in the company. As of December 31, Yacktman Asset Management is the leading shareholder in the company and has a stake worth $180.8 million.

On March 30, Stifel analyst Derrick Whitfield revised his price target on Diamondback Energy, Inc. (NASDAQ:FANG) to $172 from $176 and maintained a Buy rating on the shares.

Over the past 3 months, Diamondback Energy, Inc. (NASDAQ:FANG) has received 14 Buy ratings and 1 Hold rating from Wall Street analysts. The stock has a consensus Strong Buy rating and an average price target of $173.06, which implies an upside of 21.04% from current levels. As of April 5, Diamondback Energy, Inc. (NASDAQ:FANG) is trading at a TTM PE ratio of 5.81 and is placed fourth on our list of the best undervalued energy stocks to buy according to hedge funds.

3. Occidental Petroleum Corporation (NYSE:OXY)

Number of Hedge Fund Holders: 71

Average Analyst Price Target as of April 5: $72.40

Average Upside Potential as of April 5: 12.13%

PE Ratio (TTM) as of April 5: 5.21

Occidental Petroleum Corporation (NYSE:OXY) has received 9 Buy ratings and 5 Hold ratings from Wall Street analysts over the past 3 months. The stock’s average upside potential, as of April 5, is 12.13% and Occidental Petroleum Corporation (NYSE:OXY) is trading at a PE multiple of 5x. Occidental Petroleum Corporation (NYSE:OXY) is one of the best undervalued energy stocks to buy now according to analysts.

This March, Raymond James analyst John Freeman updated his price target on Occidental Petroleum Corporation (NYSE:OXY) to $75 from $80 and maintained a Strong Buy rating on the shares.

Occidental Petroleum Corporation (NYSE:OXY) was a part of 71 investors’ portfolios at the close of Q4 2022. These funds held collective stakes worth $16.6 billion in the company. As of December 31, Berkshire Hathaway is the top investor in the company and has disclosed a position worth $12.2 billion.

Here is what Smead Capital Management had to say about Occidental Petroleum Corporation in its Q3 2022 investor letter:

“Our top-performing stocks in the quarter includes Occidental Petroleum (NYSE:OXY). Oil and gas have been the best game in the stock market town this year and it was a pleasant surprise to see home builders pick up even with dour news on interest rates and the economy. For the first three quarters of the year, we should change the name of our fund to the Jed Clampett Fund. Occidental Petroleum (NYSE:OXY), was one of the standouts. Up through the bear market came a “bubblin’ crude!”

2. Marathon Petroleum Corporation (NYSE:MPC)

Number of Hedge Fund Holders: 52

Average Analyst Price Target as of April 5: $151.31

Average Upside Potential as of April 5: 12.79%

PE Ratio (TTM) as of April 5: 4.74

Marathon Petroleum Corporation (NYSE:MPC) is one of the best undervalued energy stocks to buy now. As of April 5, the stock is trading at a TTM PE ratio of 4.74 and has an average upside potential of 12.79%.

On April 5, Barclays analyst Theresa Chen raised her price target on Marathon Petroleum Corporation (NYSE:MPC) to $139 from $130 and reiterated an Overweight rating on the shares. Over the past 3 months, the stock has received 11 Buy ratings and 2 Hold ratings from Wall Street analysts and has a consensus Strong Buy rating.

At the end of Q4 2022, Marathon Petroleum Corporation (NYSE:MPC) was held by 52 hedge funds that disclosed collective stakes worth $3.04 billion in the company. Of those, Elliott Management was the most prominent shareholder and held a position worth $1.2 billion.

1. Valero Energy Corporation (NYSE:VLO)

Number of Hedge Fund Holders: 47

Average Analyst Price Target as of April 5: $163.93

Average Upside Potential as of April 5: 20.27%

PE Ratio (TTM) as of April 5: 4.65

47 hedge funds disclosed having stakes in Valero Energy Corporation (NYSE:VLO) at the close of the fourth quarter of 2022. The total value of these stakes amounted to $978 million. As of December 31, AQR Capital Management is the largest investor in the company and has a position worth $165 million.

This March, JPMorgan analyst John Royall raised his price target on Valero Energy Corporation (NYSE:VLO) to $172 from $160 and reiterated an Overweight rating on the shares.

Valero Energy Corporation (NYSE:VLO) has received 14 Buy ratings from Wall Street analysts over the past 3 months. The stock has an average price target of 163.93, which represents an upside of 20.27% from current levels. As of April 5, the stock is trading at a PE multiple of 4x. Valero Energy Corporation (NYSE:VLO) is the best undervalued energy stock to buy now according to analysts.

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