Energy Business

13 Top Oil & Gas Stock Picks for 2018 as Oil Challenges $60

Deutsche Bank has a $54 price target on Halliburton that is higher than the consensus target of $53.16. The shares were trading at $47.30 when featured, but more recently the stock went up to $48.77. Shareholders also receive a 1.52% dividend to consider in the total return forecasting.

Halliburton shares were last seen down almost 10% so far in 2017.

Gulfport Energy Corp. (NASDAQ: GPOR) was raised to Overweight from Neutral at JPMorgan on December 15. The consensus price target was $19.23 at the time, but that consensus is now closer to $19.10. Gulfport shares are now also trading at $12.75, with a 52-week range of $10.90 to $23.11. More recently than the JPMorgan call, S&P raised its corporate credit rating on December 21 to BB− from B+ in a credit analysis.

Gulfport Energy shares were last seen down 40% so far in 2017.

Noble Energy Inc. (NYSE: NBL) was raised to Buy from Hold with a $32 price target at Jefferies on December 20. The shares closed up 3.6% at $27.23 ahead of the call, and they more recently traded at $29.50. That compares to a 52-week range of $22.99 to $40.89, and this call from Jefferies is actually almost $4 lower than the consensus price target of $36.00. On December 21, Barclays raised Noble’s price target to $32 from $31 as well.

Noble Energy shares were last seen down 22% so far in 2017.

Phillips 66 Partners L.P. (NYSE: PSXP) was raised to Buy from Neutral with a $60 price target at Goldman Sachs on December 18. The units were last seen trading at $51.23, and the 5% yield would represent a total return of over 22% if the firm is correct. The 52-week trading range is $44.40 to $58.00, and the consensus price target is $59.43.

Phillips 66 Partners units shares have risen more than 7% so far in 2017.

ProPetro Holding Corp. (NYSE: PUMP) was started with a Buy rating and assigned a $27 price target at SunTrust Robinson Humphrey on December 20. This compares with a $19.36 prior closing price, and the shares were up 2.5% at $19.85 after the call. More recently, ProPetro shares were up at $20.50. The stock had a consensus target price of $21.00 ahead of the call, and its consensus target is now $21.91. The 52-week range now also is higher at $10.84 to $20.59.

This fracking and complementary oil services outfit targets the Permian, and its market cap is a mere $1.7 billion. Without a full year of data, its shares screened as being up 41% in 2017.

RSP Permian Inc. (NYSE: RSPP) is an independent oil and natural gas company focused on the Permian Basin. The vast majority of the company’s acreage is located on large, contiguous acreage blocks in the core of the Midland Basin. RBC added RSP Permian to the RBC Global Energy Best Ideas list this fall, and it was recently noted as being one of RBC’s four top picks for higher oil in 2018.

What makes RSP Permian look interesting beyond just one analyst call is that it has landed multiple analyst upgrades from top Wall Street companies over the past year. Some even believe RSP Permian could be a potential takeover candidate. The RBC price target is $47, and Baird and Stifel both recently raised their targets to $46. The consensus target is $46.29. Shares were at $39.82 around the RBC inclusion, but the stock was last seen up at $40.85. Its shares are down over 8% so far in 2017. The RBC report noted this:

The company trades in line (2019 Enterprise Value/EBITDA) with Permian peers but has one of the best debt-adjusted production growth outlooks among peers. Cash margins per BOE are also amongst the best in the industry. There is visibility for 30%+ growth in 2018 and 2019 at cash flow levels assuming $50-55/bbl. We expect management to remain disciplined, as it has demonstrated before, if oil prices weaken and maintain a cash flow neutral bias. We see further upside to our valuation through improving capital efficiency in the Delaware and expanding resource potential in both its operating areas.

Southwest Gas Holdings Inc. (NYSE: SWX) was raised to Buy from Neutral at UBS on December 19, and the price target was raised to $97 from $85 in that call. The prior closing price was $79.67, and the call implied upside of almost 24% when the 2.5% dividend yield is accounted for. That being said, the shares were up 3.8% at $82.75 shortly after the call but have since mellowed down to $80.00. The pre-call consensus target was $79.00 but is now above $82.

Southwest Gas has a market cap nearing $4 billion and a 52-week range of $71.51 to $86.87. Its shares are up over 4% so far in 2017.