Apache pays an annual dividend of $0.10 a share and is expected to post earnings per share of $0.36 in 2021. At its recent trading price, the stock has a potential gain of around 47% based on its 52-week high of $33.77 and 63% based on its high price target of $29.
Devon Energy Corp. (NYSE: DVN) posted a per-share loss of around 35% in 2020 but has recovered about 60% of that loss since 2021 began. The consensus price target on the stock is $19.79, and it traded recently at around $19.40. In September, Devon paid about $2.6 billion in stock for WRX Energy.
The oil and gas producer pays an annual dividend of $0.44 (yield of 2.43%) and is expected to report per-share earnings of $0.07 in 2021. The potential upside on Devon stock, based on its 52-week high of $26.98, is 28%. On the basis of a high price target of $33, the potential upside is 70%.
In 2020, EOG Resources Inc. (NYSE: EOG) stock dropped by about 39%, but it has risen by 26% since the beginning of the year. Analysts have a consensus price target of $64.42 on the shares, just a bit higher than the current trading price of around $62.20.
EOG pays an annual dividend of $1.55 (yield of 2.55%) and is expected to report earnings per share of $2.43 in 2021. At the current price, the potential upside to the 52-week high of $88.09 is nearly 30% and the potential gain to the high price target of $90 is 45%.
Pioneer Natural Resources
Though Pioneer Natural Resources Co. (NYSE: PXD) posted a 2020 loss of about 23%, it has managed to recover nearly all of it by surging 21% since the beginning of the year. In October, Pioneer paid $4.5 billion in stock for Parsley Energy. The consensus price target on the stock is $139.19, just a dollar higher than its current trading price.
Pioneer pays an annual dividend of $2.20 (yield of 1.67%) and is expected to post earnings per share of $5.69 in 2021. At its current price, the potential gain compared to the 52-week high of $149.54 is about 7.6%. Compared to a high price target of $201, the potential upside from the recent price is 45%.
It is also interesting to look at these six stocks compared to the two U.S. major integrated oil and gas stocks, Exxon and Chevron. Those two saw share prices dip by 27% and 26%, respectively, in 2020. Chevron recovered more than a third of that loss in the first few days of 2021 trading, and Exxon has recovered more than half its loss in all of last year.
But Exxon’s annual dividend of $3.48 (yield of 7.43%) and Chevron’s $5.16 dividend (yield of 5.63%) far outpace any of the independents. One question investors have to ask themselves is how long either or both of these giants can keep paying these massive yields. Another is whether the independents are more or less likely than the giants to see share price appreciation.
So far, the giants seem to be holding their own in price appreciation and are way ahead in dividends. Watch for new ratings and price targets on the independents to begin emerging now that trading prices have outrun targets. Something has to give here.
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