10 Most Undervalued Stocks to Buy and Hold for 3 Years

8. Civitas Resources Inc. (NYSE:CIVI)

Forward P/E Ratio as of July 22: 5.05

3-Year Revenue CAGR: 44.69%

Number of Hedge Fund Holders: 41

Civitas Resources Inc. (NYSE:CIVI) is one of the most undervalued stocks to buy and hold for 3 years. On July 17, Piper Sandler increased the price target for Civitas Resources from $54 to $57, while maintaining an Overweight rating. The firm noted that the exploration and production investment environment remains challenging post-Q2.

This is due to fluctuating oil prices. Simultaneously, strong secular demand trends for natural gas are counteracted by high supplies and inventory builds. Despite these challenges, the long-term outlook for natural gas demand is positive. The sentiment was reinforced by the recent PA Power and Innovation Summit, which saw the announcement of $90 billion in investments for power and data center infrastructure.

In Q1 2025, the company announced a $150 million reduction in capital expenditure compared to 2024. The company also implemented a cost optimization and efficiency plan targeting an incremental $100 million in annual free cash flow, with ~40% of this benefiting H2 2025. An oil gathering agreement is expected to contribute an additional $15 million annually to free cash flow.

Civitas Resources Inc. (NYSE:CIVI) is an exploration and production company that focuses on the acquisition, development, and production of crude oil and associated liquids-rich natural gas.