ConocoPhillips (COP) closed the most recent trading day at $101.09, moving +1.01% from the previous trading session.
As the calendar turns over to 2025, the leading Wall Street firms are releasing their top stock picks for the new year.
The oil market in 2025 may stay volatile, balancing rising supply with moderate demand growth. Focusing on stocks like XOM, FANG and COP could be wise.
In the closing of the recent trading day, ConocoPhillips (COP) stood at $96.92, denoting a +0.03% change from the preceding trading day.
ConocoPhillips (COP) closed at $96.89 in the latest trading session, marking a -0.23% move from the prior day.
ConocoPhillips shares are near a 52-week low, impacted by ample oil supply and sluggish global growth affecting commodity prices. Despite operational strength and increased production, the challenging commodity price environment is expected to persist into 2025, given the overhang of OPEC+ supply cuts. Conoco's acquisition of Marathon Oil enhances scale and capital productivity, with a low free cash flow breakeven ensuring dividend security.
Favorable oil prices are aiding COP's bottom line. However, the stock is exposed to commodity price volatility.
The exploration and production (E&P) industry is expected to be shaped by efficiency improvements, mergers and acquisitions (M&A) and shifting commodity trends in 2025, analysts at Citi believe. In their 2025 sector outlook, the analysts wrote that despite significant operational advancements in 2024, E&P equities struggled to differentiate themselves, overshadowed by crude price concerns and broader market dynamics.
Noteworthy energy transactions for 2024 included major players such as FANG, COP, EQT, EXE and SUN.
ConocoPhillips, a $123 billion market cap company, successfully completed its acquisition of the much smaller Marathon Oil. It has an investor-friendly capital return program with a 3.3% dividend, and large share repurchases. Pro forma post-acquisition annual cost savings are estimated at $500 million, while asset disposition is expected to total another $2 billion.
While the undervaluation of ConocoPhillips stock presents an investment opportunity, investors might prefer to wait until some uncertainties are addressed.
The fall in oil import volumes in 2025 is expected to create opportunities for upstream players like EOG and COP, as well as midstream firms like KMI and ENB.