We are screening the wirehouses energy research world looking for quality energy stocks that are rated Buy and trading way off their highs in this market, that are strong enough to hold on, be bought for value, and recover as Crude Oil prices recover thru 2021.
These 2 are smaller capitalization stocks for aggressive investors.
Parsley Energy Inc. (NYSE:PE) is an Oil & Gas producer with 227,000 net acres in the Permian Basin. The majority of acreage sits on the Midland side of the basin, but the company also holds an acreage position in the Delaware Basin.
Through strategic acquisitions and acreage swaps, it has grown its acreage position since its IPo and has over 7,900 horizontal locations across multiple prospects.
The company is catalyst rich and a Permian Basin pure play. PE has some of the strongest wells in the basin, generating returns that are among the best in the sector. It is also rapidly de-risking its drilling inventory and is well positioned to continue to beat its strong growth projections.
Shareholders receive a 1.91% dividend. BofA Securities has set a 12 price target. The Street’s consensus target is 27.0 mine is 30, and Parsley Energy stock closed trading Thursday at 8.30.
There is strong support at 7.41 and Key resistance at 16.91.
WPX Energy Inc. (NYSE:WPX) is an independent Oil & Gas exploration and production company that engages in the exploitation and development of unconventional properties in the United States.
Its principal areas of operation include; the Permian Basin, the Williston Basin in North Dakota and the San Juan Basin in New Mexico and Colorado.
WPX is a premier Permian-levered operator with sector-leading debt-adjusted cash flow growth supported by strong execution in the core Delaware, all while trading at Williston valuations primarily due to its high financial leverage.
The BofA Securities analysts have a 7 price target. The posted consensus price objective is 9.12, and shares ended Thursday at 4.88, +0.30. My target is 14.24 on the recover of Crude Oil to 40bbl.
Both of these companies have been hammered by the relentless selling. But, we have done the DD work looking for companies that are poised to survive this year and hold on until prices improve.
We believe that there could be some serious money made on these issues.
Plus, if there comes a massive industry consolidation later in Y 2020 and in Y 2021 they could be in focus.
Note: If either cash situation worsens, all Oil & Gas companies paying dividends could lower or eliminate them.
Have a healthy day, Keep the Faith!