Top 5 Oil and Gas Stocks to Invest In

3. Devon Energy Corporation (NYSE:DVN)

No of Hedge Fund Holders: 45
Total Value of Hedge Fund Holdings: $709 Million

Energy giant Devon Energy Corporation ranks 3rd on the list of top 10 oil and gas stocks to invest in. Headquartered in Oklahoma City, Oklahoma, Devon Energy Corporation is engaged in hydrocarbon exploration in the American market. In 2020, the company acquired WPX Energy, a company engaged in hydrocarbon exploration in a $2.56 billion deal.

In March, the Goldman Sachs Group gave DVN a Buy recommendation and a $30.75 price target. According to Goldman Sachs Group’s price target, the stock could rise 35.22% from its current price. The company has a market cap of $14.1 billion and a full-year 2020 revenue of $4.8 billion. Shares of DVN surged 131% over the last twelve months. At the end of the fourth quarter, there were 45 hedge funds that reported owning stakes in Devon Energy Corporation, down from 44 funds a quarter earlier. The total value of these stakes at the end of Q4 is $709 million.

GoodHaven Capital Management mentioned that the merger with WPX would give the company enough cash flow with a more economical price in its Q4 2020 investor letter:

“After a rough start to the year our two biggest energy holdings – WPX Energy rebounded materially in the last six months though energy was still our biggest detractor for the year. I’ve previously written about deciding earlier this year to direct new capital towards better businesses versus adding more to the energy sector, but given the material optionality at WPX, we opted to maintain a material exposure. Recently WPX announced an all stock merger with a larger competitor – Devon Energy – which will leave the new company with plenty of cash flow at lower oil prices, less leverage, and material upside to higher commodity prices.”