5 Best Oil and Gas Penny Stocks to Buy Now

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1. Kosmos Energy Ltd. (NYSE:KOS)

Number of Hedge Fund Holders: 21

Topping our list of the Best Oil and Gas Penny Stocks is Kosmos Energy Ltd. (NYSE:KOS). It is a leading deepwater exploration and production company focused on meeting the world’s growing demand for energy.

On March 23, Goldman Sachs raised its price target on Kosmos Energy Ltd. (NYSE:KOS) from $2 to $2.25, while maintaining a ‘Neutral’ rating on the shares. The bumped target indicates a downside of over 22% from the current levels.

Kosmos Energy Ltd. (NYSE:KOS) reported its Q4 2025 results earlier this month, with the company falling behind estimates in both earnings and revenue. That said, Kosmos announced a strong outlook for FY 2026, with a target to deliver 15% YoY production growth coming predominantly from its core, Jubilee, and GTA assets. Moreover, the company aims to achieve this while also reducing its total operating costs by 20%, with the combination of higher production and lower costs expected to reduce OpEx per barrel by around 35%. Notably, the firm is also aiming to cut its debt by at least 10% by the end of 2026.

Kosmos Energy Ltd. (NYSE:KOS) was also recently included in our list of the 10 Small-Cap Stocks Insiders are Buying Recently.

While we acknowledge the potential of KOS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than KOS and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 14 Best Energy Stocks to Buy According to Wall Street Analysts and 13 Oil Stocks with Highest Dividends

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