Despite a huge rally off the March bottom that has U.S. indexes once again trading near all-time highs, many of the top companies that investors are very familiar with have taken a beating over the past few years. The ones that have been beaten down the most are in sectors that are struggling the most, with the temporary new normal rules that are still in place to varying degrees around the country.
We screened the BofA Securities research database looking for well-known former blue-chip companies that are likely to survive their current troubles. We found four that are rated Buy and could very well offer patient investors some huge returns over the next year or so. Patient investors that did that in 2008 and 2009 absolutely killed it over the next few years.
Remember that no single analyst report should be used as a sole basis for any buying or selling decision.
This has long been considered an industry leader but its stock has been battered. Apache Corp. (NYSE: APA) is an independent energy company that explores for, develops and produces natural gas, crude oil and natural gas liquids (NGLs). The company has operations in onshore assets located in the Permian and Midcontinent/Gulf Coast onshore regions, and offshore assets situated in the Gulf of Mexico region. It also holds onshore assets in Egypt’s Western desert and offshore assets in the North Sea region, including the United Kingdom.
Apache also has an offshore exploration program in Suriname. As of December 31, 2019, it had total estimated proved reserves of 551 million barrels of crude oil, 186 million barrels of NGLs, and 1.6 trillion cubic feet of natural gas. The company remains an acquirer/exploiter/explorer, fiscally conservative company that has grown its reserves and production consistently via acquisitions and organic projects.
Apache posted a solid second quarter, and the analysts said this:
A solid second quarter sees costs and capex trending down and implies a second half of 2020 cash break-even at $30 a barrel with free cash at the current strip. But overshadowing the quarter was an announced 3rd exploration success at Kwaskwasi further linking Apache’s story to Suriname. Resource scale suggests that story is just getting started but with Suriname still poorly reflected in the company’s share price.
Apache pays a small 0.65% dividend. BofA Securities has a gigantic $23 price target, compared to the Wall Street consensus target of $17.16. Apache stock has found support at the $9 level for the past few weeks.
This remains a solid value play now, and demand could jump when the coronavirus issues have passed. Ford Motor Co. (NYSE: F) is one of the world’s largest vehicle producers, with over 6 million units manufactured and sold globally. The company has made significant progress executing on its One Ford plan and delivering best-in-class vehicles.
Ford is among the car brands with the most loyal customers, and it remains committed to positioning itself well within the evolving auto industry through balanced investments across electrification, autonomy and mobility services.
Ford last week reported that its third-quarter sales in China jumped 25.4%, compared with the year-ago period, totaling 164,352 vehicles. It is the company’s best result in nearly four years in the world’s largest automotive market. It was also a 3.6% increase compared with the second quarter of this year, as the country’s recovery from the coronavirus pandemic continues to strengthen. Sales of Ford, Lincoln and JMC brand vehicles achieved year-over-year growth of 12.5%, 64.8% and 38.3%, respectively.
BofA Securities has a $9 price target on the venerable car company. The posted consensus target is $6.41. Ford stock recently rose above the $8 level for the first time since February.