3. ConocoPhillips (NYSE:COP)
Number of Hedge Fund Holders: 85
ConocoPhillips (NYSE:COP) is an independent exploration and production company that specializes in natural gas, liquefied natural gas (LNG), and crude oil and has established a strong presence in the Asia-Pacific, Europe, Canada, and the U.S. shale basins. The company maintains a strong presence in LNG markets due to key contracts and strategic assets that foster long-term expansion.
ConocoPhillips (NYSE:COP) produced 1.84 million barrels of oil equivalent per day (MMBOED) in 2024, marking a 3% increase from the previous year. This growth was primarily driven by a notable increase in LNG volumes and strong performance from U.S. shale operations. The company generated $21.3 billion in operating cash flow, driven by its efforts to maintain capital discipline and capitalize on rising commodity prices. However, because of increased operating costs and acquisition-related expenses that affected overall profitability, net income decreased to $11.2 billion from $18.7 billion in 2023.
ConocoPhillips (NYSE:COP) made great progress in growing its LNG strategy despite the profitability issues. The company established a long-term LNG sales agreement in Asia and obtained a long-term regasification agreement for Belgium’s Zeebrugge LNG terminal in 2024. In addition, the company has significant stakes in LNG production plants in Australia and Qatar. Furthermore, the company secured a long-term capacity agreement for the Zeebrugge terminal, operated by Fluxys, thereby solidifying its LNG business as a crucial area of expansion.
ConocoPhillips (NYSE:COP) announced $1.3 billion in asset divestitures as part of its plan to simplify its holdings and strengthen its financial position. The $735 million sale of the company’s interests in the Ursa and Europa Fields to Shell, which is anticipated to close by Q2 2025, came after the company’s $22.5 billion acquisition of Marathon Oil. The company also divested $600 million worth of non-core Lower 48 assets. These steps will help strengthen the company’s balance sheet and optimize its portfolio for future growth as part of its larger asset disposition target of $2 billion.
Going forward, ConocoPhillips (NYSE:COP) is committed to maintaining its current growth trajectory. With a continued focus on long-cycle projects and high-return shale assets, the company anticipates that production will range between 2.34 million and 2.38 million barrels of oil equivalent per day in 2025. To balance investments and guarantee long-term value creation, ConocoPhillips has set a target shareholder return of $10 billion. As it continues its trajectory of steady growth and innovation, the company is well-positioned to prosper in a dynamic and frequently volatile market environment.
