Investing

Well-Known Energy Companies Highlight Goldman Sachs Stocks to Buy Under $10

Oceaneering International

This deepwater driller and contrarian play could have potential as a takeover target. Oceaneering International Inc. (NYSE: OII) is a global provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater applications. Through the use of its applied technology expertise, Oceaneering also serves the defense, entertainment and aerospace industries.

The services and products it provides to the oil and gas industry include remotely operated vehicles, specialty subsea hardware, engineering and project management, subsea intervention services, including manned diving, survey and positioning services and asset integrity and nondestructive testing services. The company serves the defense, aerospace and commercial theme park industries.

The $10 Goldman Sachs price objective compares to the $6.02 consensus estimates. Oceaneering International stock ended last week just above $6.

Plains All American Pipeline

This remains a top master limited partnership (MLP) pick across Wall Street. Plains All American Pipeline L.P. (NYSE: PAA) is primarily engaged in midstream crude oil activities, including transportation, gathering, marketing and terminaling.

Top analysts, including the Goldman Sachs team, feel the company deserves a premium valuation given its leverage to the Permian and attractive organic growth backlog. The company owns an extensive network of pipeline transportation, terminaling, storage and gathering assets in key crude oil and NGL producing basins and transportation corridors and at major market hubs in the United States and Canada.

On average, Plains All American handles more than 6 million barrels per day of crude oil and NGL in its Transportation segment.

Investors still receive a solid 8.60% distribution. Goldman Sachs has set an $11 price objective, but the consensus target is higher at $12.26. Last week, Plains All American Pipeline stock fell below $9 for the first time in a month.

TechnipFMC

The analysts remain positive on this large-cap company. TechnipFMC PLC (NYSE: FTI) is a large, diversified oil services provider with a strong strategic focus on the offshore market.

The company, which is headquartered in the United Kingdom and listed in both Paris and New York, is the second-largest oil services provider with a European listing. It has a truly global footprint, employing 37 thousand people around the world, with its revenue mix temporarily skewed towards Russia, where it executes the large Yamal LNG project.

The second-quarter earnings estimate has been raised by a penny to $0.07 per share. The full-year estimate for 2020 is up to $0.38 per share from the previous $0.35. However, the 2021 estimate has been reduced by a penny to $0.59 per share.

The Goldman Sachs price target is $12.50. The consensus figure is $11.52. TechnipFMC stock was trading above $7 late last week.

These five stocks trading under the $10 level have big upside to the analyst price targets. Again, while not suitable for conservative accounts, aggressive investors can get some solid share leverage buying more shares and can make money on a much smaller share price move. Plus, they are all covered with a Buy rating at the top firm on Wall Street, Goldman Sachs.