Top 5 Oil and Gas Stocks to Invest In

1. ConocoPhillips (NYSE:COP)

No of Hegde Fund Holders: 49
Total Value of Hedge Fund Holdings: $687 Million

Topping the list of 10 oil and gas stocks to invest in is ConocoPhillips. Based in Houston, Texas, the hydrocarbon exploration company owns approximately 1.6 million net acres in the Lower 48. In 2020, the company confirmed a new gas condensate discovery in development license 1009, situated in the Norwegian Sea 22 miles northwest of the Heidrun Field and 150 miles from Norway’s coast.

In April, Keybanc kept its Overweight rating on ConocoPhillips and raised its price target to $63 a share. The company has a market cap of $65.7 billion and full-year revenue of $18.8 billion in 2020. The stock has gained 46% over the past twelve months. COP was in 49 hedge funds’ portfolios at the end of December, up from four hedge funds from the third quarter.

Oakmark Funds mentioned that ConocoPhillips is one of the world’s best independent oil companies today in its Q1 2021 investor letter:

“We elected to retain a position in ConocoPhillips following its all-stock acquisition of portfolio holding Concho Resources after determining that the combined entity was nearly as undervalued as stand-alone Concho. We believe Conoco is one of the highest quality independent oil producers in the world today. The company has decades of low-cost drilling inventory in attractive oil basins, minimal leverage and industry-leading returns on invested capital. Conoco management has built this enviable competitive position through years of shrewd capital allocation and efficient operations. This includes a history of accretive divestitures and opportunistic acquisitions, the latest example being Concho. For Conoco, the Concho deal adds some of the highest quality acreage in the Permian Basin at an attractive all-in cost, with an opportunity to create incremental value by eliminating duplicative costs and monetizing excess acreage. We believe this value-focused approach to both acquisitions and divestitures is rare in oil and gas and we are pleased to invest alongside these stewards of capital. The shares are priced at a double-digit free cash flow yield and a discount to peers on most earnings metrics, so we took advantage of the opportunity to own the business at an attractive price.” 

You can also take a peek at 10 Best Biotech Stocks To Buy For 2021 and Top 10 Best Freelancing Platforms and Websites for 2021.

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