The week of September 23 was somewhat of a strong one for the oil and gas industries. Sadly, that strength wasn’t seen late on Friday. West Texas Intermediate (WTI) crude is again trading close to $45 per barrel. This is a level at which many investors want to know which oil and gas stocks they should be looking to buy for long-term opportunities. One trend that has been proven over and over is that investors want to buy their favorite stocks either on pullbacks or when they can be opportunistic.
24/7 Wall St. tracks dozens of analyst upgrades and downgrades each day of the week. Many of these calls are in companies that are well-known in the oil and gas industries. The week of September 23 brought numerous analyst upgrades and downgrades in oil and gas stocks.
Some analysts believe many of the energy stocks continue to be very smart buys. Just do not ignore the notion that some of these “big buy ratings” also have analysts elsewhere telling clients to sell or hold.
When oil is back in the mid-$40s, some companies can take the risk-on attitude. Others have to sit idle. The reality is that much of the oil and gas industry remains in a zombie mode right now.
Buying oil and gas stocks down in the $30s for oil was a serious win. Buying in the mid-$40s comes with more price stability but also often comes with less implied analyst upside. It is also important to consider that any and all of these analyst price targets and upside projections will look rather silly if oil drops back down into the $30s again.
Here are the top energy stocks with major analyst calls from the week of September 19 to September 23, 2016.
Enterprise Products Partners L.P. (NYSE: EPD) was raised to Outperform from Neutral at Credit Suisse on September 19. It had seen serious weakness prior to this over concerns it may try to get involved in a large merger as the acquirer, but Credit Suisse’s John Edwards maintained his $34 price target. While the full details of this upgrade show what matters most, investors should consider that this is 5% higher than the consensus analyst price target. The company’s units traded at $27.28 on Friday’s close, with a 52-week range of $19.00 to $30.11. Its distribution has a yield equivalent of well over 5% as well.
Western Refining Inc. (NYSE: WNR) was raised to Outperform from Neutral at Credit Suisse on September 19. The official price target was raised to $31 from $27, but what really stood out was the note that Western Refining could rise to $40 in 2020 in a more detailed outlook. Shares closed trading at $27.52 on Friday, in a 52-week range of $18.14 to $47.55. The consensus target price is actually lower at $25.82.