Earlier on January 24, Tom Lee, Managing Partner at Fundstrat Global Advisors, joined CNBC’s ‘Closing Bell’ to suggest energy and basic materials as top sector picks this year. Lee characterized the then-market environment as volatile but hesitated to label individual company challenges as representative of the broader market. He suggested that it is natural for stocks that have performed exceptionally well to face some punishment during earnings season. Furthermore, while Lee maintained his affinity for the MAG7 and other mega-caps due to their strong earnings visibility, he identified energy and basic materials as his top sector picks for 2026.
According to Fundstrat’s 2026 outlook, energy and materials had underperformed over the previous five years to a degree that historically marks a turning point to the upside. Lee argued that, because so much bad news was already baked in, the stocks could perform very well even with just ‘okay’ fundamentals. He also believes that the turnaround for small caps is likely part of a multi-year cycle, potentially lasting up to 12 years. He expects small caps to benefit from a dovish Fed and a possible wave of mergers & acquisitions.
That being said, we’re here with a list of the 11 cheap energy stocks to buy right now.
Our Methodology
We used screeners to identify energy stocks that are trading below a forward P/E of 15, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Note: All data was sourced on February 26.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
11 Cheap Energy Stocks to Buy Right Now
11. Matador Resources Company (NYSE:MTDR)
Matador Resources Company (NYSE:MTDR) is one of the cheap energy stocks to buy right now. On February 24, Matador Resources reported financial results for 2025, highlighted by a 9% increase in total proved oil and natural gas reserves, reaching 667 million BOE. During Q4, the company achieved its highest-ever average production of 211,290 barrels of oil and natural equivalent/BOE per day (121,363 barrels of oil per day). This success was paired with significant debt reduction, as the company paid down ~$200 million on its credit facility and maintained a strong leverage ratio of 1.1x.
For 2026, Matador’s operating plan prioritizes capital efficiency and moderate growth. The company expects to increase oil production by 3% while reducing total capital expenditures by 11% to ~$1.50 billion. This efficiency is driven by a projected 6% reduction in drilling and completion costs per lateral foot and a 13% improvement in well cycle times.
Additionally, Matador has secured a strategic gas transportation deal on the Hugh Brinson pipeline, which is expected to provide better market access and higher realized pricing by late 2026. Matador Resources Company (NYSE:MTDR) also continues its brick-by-brick land strategy, having added 17,500 net acres in the Delaware Basin to maintain over a decade of high-quality drilling inventory.
Matador Resources Company (NYSE:MTDR) is an independent energy company that acquires, explores, develops, and produces oil and natural gas resources in the US. It operates through two segments: Exploration & Production and Midstream.
10. Range Resources Corporation (NYSE:RRC)
Range Resources Corporation (NYSE:RRC) is one of the cheap energy stocks to buy right now. On February 24, Range Resources reported earnings for 2025, generating over $650 million in free cash flow and $1.3 billion in cash flow from operations. The company averaged 2.24 Bcfe per day in production while achieving record operational efficiencies, including a new benchmark of 9.7 frac stages per day. This performance allowed Range to reduce its net debt by $186 million.
For 2026, Range Resources has established a capital budget of $650 to $700 million, targeting a production increase to between 2.35 and 2.40 Bcfe per day. The strategy focuses on converting a substantial portion of its 500,000-foot drilled-but-uncompleted inventory, which provides a flexible path toward a further production ramp-up to 2.6 Bcfe per day in 2027.
Strategic marketing remains a key pillar of growth, highlighted by a new 10-year agreement to supply natural gas to a Midwest power plant at premium pricing. While Range Resources Corporation (NYSE:RRC) anticipates a slight production dip in Q1 2026 due to the timing of infrastructure expansions, a mid-year step-up is expected as new processing capacity comes online.
Range Resources Corporation (NYSE:RRC) operates as an independent natural gas, natural gas liquids/NGLs, and oil company in the US. The company explores, develops, and acquires natural gas, NGLs, and oil properties located in the Appalachian region.
9. Sunoco LP (NYSE:SUN)
Sunoco LP (NYSE:SUN) is one of the cheap energy stocks to buy right now. On February 17, Sunoco delivered financial results for 2025, capped by a Q4 that saw adjusted EBITDA reach $706 million. This result was largely driven by the integration of the Parkland Corporation acquisition, which closed in late October and transformed Sunoco into the largest independent fuel distributor in the Americas. For the full year, the company achieved a 36% increase in adjusted EBITDA to $2.12 billion.
The company maintains a strong balance sheet with a 1.9x coverage ratio and $2.5 billion in liquidity, ending the year at its long-term leverage target of approximately 4x. This stability encouraged management to target an annual distribution growth rate of at least 5% for 2026, backed by a strong fuel distribution margin of $0.177 per gallon.
For 2026, Sunoco LP (NYSE:SUN) issued optimistic adjusted EBITDA guidance of $3.1 to $3.3 billion. The company plans to invest at least $600 million in growth capital projects and between $400 and $450 million in maintenance. While a 50-day maintenance turnaround at its refinery may impact Q1, the partnership remains focused on bolt-on acquisitions and further geographic expansion across the US, Canada, and Europe to sustain its multi-year growth trajectory.
Sunoco LP (NYSE:SUN), together with its subsidiaries, engages in the energy infrastructure and distribution of motor fuels in the US. It operates in four segments: Fuel Distribution, Pipeline Systems, Refinery, and Terminals.
8. Ovintiv Inc. (NYSE:OVV)
Ovintiv Inc. (NYSE:OVV) is one of the cheap energy stocks to buy right now. On February 23, Ovintiv officially completed its multi-year portfolio transformation, narrowing its focus to the Permian and Montney basins following the acquisition of NuVista and the strategic sale of its Anadarko assets. The Anadarko sale, expected to yield $3 billion in cash proceeds, will be used to slash net debt to approximately $3.6 billion and clear out all long-term debt maturities until 2030.
Under a newly authorized $3 billion repurchase program, Ovintiv plans to return at least 75% of its 2026 free cash flow to shareholders through dividends and buybacks. Management believes the stock is significantly undervalued and intends to use a flexible return framework (ranging from 50% to 100% of free cash flow) to capitalize on market cycles.
For 2026, the company is moving into a maintenance mode, targeting total production of 620,000 to 645,000 BOE/d with a capital budget of ~$2.3 billion. Operational efficiency remains a core theme, particularly through the use of surfactants in the Permian, which delivered a 9% uplift in oil productivity. In the Montney, Ovintiv Inc. (NYSE:OVV) is applying its proprietary drilling and completion techniques to the newly acquired NuVista acreage, targeting $1 million in cost savings per well.
Ovintiv Inc. (NYSE:OVV), together with its subsidiaries, operates as an oil and natural gas exploration and production company in North America. The company operates through the USA Operations and Canadian Operations segments.
7. Western Midstream Partners (NYSE:WES)
Western Midstream Partners (NYSE:WES) is one of the cheap energy stocks to buy right now. On February 17, Western Midstream Partners announced financial results for 2025, reporting a net income of $1.15 billion and an adjusted EBITDA of $2.48 billion. The partnership’s success was driven by increased throughput in the Delaware and DJ Basins, alongside aggressive cost-reduction efforts that lowered core operating expenses.
The integration of the Aris Water acquisition is ahead of schedule, already delivering $40 million in cost synergies and driving a 121% sequential increase in produced-water throughput in Q4. Management highlighted produced water as Western Midstream Partners’ (NYSE:WES), fastest-growing segment, significantly expanding its footprint in the Delaware Basin. However, the partnership is navigating headwinds from weak natural gas pricing at the Waha Hub, which has led to producer curtailments that are expected to persist through H1 2026.
For 2026, Western Midstream Partners issued a transition-year outlook, guiding for adjusted EBITDA between $2.5 and $2.7 billion. In response to moderated producer activity, the partnership lowered its capital expenditure guidance to a midpoint of $925 million, with major investments directed toward the Pathfinder Produced Water Pipeline.
Western Midstream Partners (NYSE:WES), together with its subsidiaries, operates as a midstream energy company primarily in the US.
6. Tenaris (NYSE:TS)
Tenaris (NYSE:TS) is one of the cheap energy stocks to buy right now. On February 19, Tenaris reported financial results for 2025, closing the year with $12 billion in annual sales and a robust net cash position of $3.3 billion. Despite a challenging geopolitical landscape and the heavy impact of 50% Section 232 tariffs in the US, the company generated $2 billion in free cash flow for the year.
Q4 specifically saw sales of $3 billion, which was a 5% year-over-year increase, supported by steady demand in rig-direct services in North America and a recovery in fracking services in Argentina. Looking toward 2026, Tenaris expects relative stability in Q1, with performance largely mirroring Q4 2025.
While North American margins face pressure from import competition and raw material price volatility, expected to peak in Q2, Tenaris (NYSE:TS) is optimistic about a recovery in the latter half of the year. Growth is anticipated from an expanding offshore backlog, particularly in Suriname and Nigeria, and a projected uptick in drilling activity in Argentina’s Vaca Muerta formation as infrastructure investments materialize.
Tenaris (NYSE:TS), together with its subsidiaries, manufactures and supplies steel pipe products and related services for the energy industry and other industrial applications in North America, South America, Europe, the Middle East and Africa, and the Asia Pacific.
5. Cheniere Energy Partners (NYSE:CQP)
Cheniere Energy Partners (NYSE:CQP) is one of the cheap energy stocks to buy right now. On February 26, Cheniere Energy Partners delivered a robust performance in 2025, generating $10.8 billion in annual revenue and $3.7 billion in adjusted EBITDA. The partnership’s Q4 results were particularly strong, with net income rising over 100% year-over-year to $1.3 billion, largely driven by favorable derivative valuations and higher margins per MMBtu of LNG delivered.
This financial success coincided with a major milestone: the 10th anniversary of the first cargo export from the Sabine Pass facility, which has now exported over 3,270 cargoes to date. For 2026, Cheniere Partners has introduced distribution guidance of $3.10 to $3.40 per unit, maintaining a steady base distribution of $3.10.
Cheniere Energy Partners (NYSE:CQP) is now focused on the Sabine Pass Expansion Project, which aims to add up to 20 mtpa of additional capacity. While the project is currently awaiting key regulatory approvals from the FERC and DOE, Cheniere continues to optimize its existing 30 mtpa footprint.
Cheniere Energy Partners (NYSE:CQP), through its subsidiaries, provides liquefied natural gas/LNG to integrated energy companies, utilities, and energy trading companies in the US and internationally.
4. Halliburton Company (NYSE:HAL)
Halliburton Company (NYSE:HAL) is one of the cheap energy stocks to buy right now. On February 22, PT Pertamina (Persero) and Halliburton entered into a strategic memorandum of understanding/MOU to accelerate the development of unconventional energy resources in Indonesia. This partnership focuses on deploying advanced well construction and stimulation technologies, specifically targeting multi-stage hydraulic fracturing and acid stimulation.
The collaboration aims to revitalize mature onshore fields and optimize their production potential to support Indonesia’s national energy supply. A key highlight of the agreement is the integration of cutting-edge digital solutions, including closed-loop automation and artificial intelligence. By applying these technologies to drilling and fracturing operations, the companies intend to improve operational precision and efficiency.
Halliburton Company (NYSE:HAL) will contribute its global unconventional expertise and localized reservoir insights, while Pertamina seeks to transform its upstream production through sustainable, technology-driven revitalization strategies. The MOU underscores Halliburton’s expanding footprint in the Southeast Asian unconventional market and reflects a broader industry trend of using high-tech automation to maximize asset value in complex environments.
Halliburton Company (NYSE:HAL) provides products and services to the energy industry worldwide. It operates in two segments: Completion & Production and Drilling & Evaluation.
3. Diamondback Energy Inc. (NASDAQ:FANG)
Diamondback Energy Inc. (NASDAQ:FANG) is one of the cheap energy stocks to buy right now. On February 23, Diamondback Energy reported strong 2025 results, headlined by full-year average production of 921.0 MBOE/d and $5.9 billion in adjusted free cash flow. Q4 specifically showed high operational efficiency with oil production reaching 512.8 MBO/d and the generation of $1.2 billion in adjusted free cash flow.
The company remains committed to aggressive shareholder returns, declaring a 5% increase in its annual base dividend to $4.20 per share. In Q4 alone, Diamondback returned $734 million to investors through dividends and the repurchase of 2.90 million shares. For the full year, total capital returns reached $3.2 billion, representing 54% of its adjusted free cash flow. The Board also highlighted a substantial remaining share repurchase authorization of $2.3 billion.
For 2026, Diamondback provided production guidance of 500 – 510 MBO/d of oil with a capital budget between $3.6 and $3.9 billion. This plan includes $100 to $150 million dedicated to exploratory development in the Barnett and Woodford formations and projects aimed at increasing oil recovery. Diamondback Energy Inc. (NASDAQ:FANG) expects to complete approximately 6 million net lateral feet during the year.
Diamondback Energy Inc. (NASDAQ:FANG) is an independent oil and natural gas company that acquires, develops, explores, and exploits unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas.
2. EOG Resources Inc. (NYSE:EOG)
EOG Resources Inc. (NYSE:EOG) is one of the cheap energy stocks to buy right now. On February 24, EOG Resources delivered financial results for 2025, generating $4.7 billion in free cash flow and maintaining a peer-leading 19% return on capital employed. The company achieved its target of returning 100% of this free cash flow to shareholders through $2.2 billion in dividends and $2.5 billion in share repurchases. Operationally, EOG reduced average well costs by 7% through sustainable efficiency gains and expanded its proved reserves by 16% to a total of 5.5 billion barrels of oil equivalent.
The company’s 2026 outlook focuses on high-return foundational plays, with a capital plan of $6.5 billion designed to hold oil production flat to Q4 levels while delivering 13% total production growth year-over-year. A key strategic priority is the Dorado gas play, which EOG identifies as the lowest-cost gas supply in the US with a breakeven price of $1.40 per Mcf. The 2026 plan is resilient, designed to break-even at $50 WTI oil prices, and includes increased activity in the Utica and international exploration in the UAE and Bahrain.
Management addressed concerns regarding inventory quality by highlighting a 30% extension in lateral lengths and a 20% reduction in costs, which have effectively unlocked new high-return targets. Despite a planned reduction in well activity in the Delaware Basin (dropping from 390 to 300 wells in 2026), EOG Resources Inc. (NYSE:EOG) expects to maintain robust cash generation.
EOG Resources Inc. (NYSE:EOG), together with its subsidiaries, explores for, develops, produces, and markets crude oil, natural gas liquids, and natural gas in producing basins in the US, the Republic of Trinidad and Tobago, and internationally.
1. Shell (NYSE:SHEL)
Shell (NYSE:SHEL) is one of the cheap energy stocks to buy right now. On February 25, Shell and METLEN (formerly Mytilineos) signed a strategic memorandum of understanding/MOU to cooperate on LNG supply and trading between 2027 and 2031. The agreement outlines the annual supply of 0.5 to 1.0 billion cubic meters/bcm of LNG, targeting Greek regasification terminals at Revithoussa and Alexandroupolis.
This partnership aims to strengthen Europe’s energy resilience by using Greece’s evolving infrastructure to secure reliable natural gas flows into the region. The collaboration is designed to utilize the Vertical Gas Corridor, an initiative aimed at increasing connectivity between Greece and several Eastern European nations, including Ukraine and Hungary.
By using the newly operational Alexandroupolis FSRU and existing pipeline networks, the partners intend to provide an alternative gas route that can access substantial underground storage in Ukraine. This moves Greece further toward its goal of becoming a primary energy hub for Southeast Europe. This deal aligns with Shell’s (NYSE:SHEL) long-term outlook, which predicts a 60% increase in global LNG demand by 2040.
Shell (NYSE:SHEL) operates as an energy and petrochemical company in Europe, Asia, Oceania, Africa, the US, and other Americas.
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