In this article, we will take a look at the 5 Best Oil and Gas Stocks to Buy According to Hedge Funds. For a deeper discussion and analysis, please refer to the 14 Best Oil and Gas Stocks to Buy According to Hedge Funds.
5. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 78
Occidental Petroleum Corporation (NYSE:OXY) is an international energy company that produces, markets, and transports oil and natural gas.
On May 26, Barclays upgraded Occidental Petroleum Corporation (NYSE:OXY) from ‘Equal Weight’ to ‘Overweight’, while also raising its price target on the stock from $59 to $72. The target boost reflects an upside of over 27% from the current levels.
Occidental’s principal debt stood at $13.3 billion at the end of the first quarter, and the company has a near-term target to reduce it to $10 billion. According to Barclays, the soaring oil prices amid the Middle East crisis should allow the company to achieve its debt goals and fully pre-fund its Berkshire preferred equity obligations by the second half of 2027. The analyst firm believes that as concerns over leverage fade, investors should shift their focus on Occidental’s “top-tier” resource portfolio and improved capital efficiency.
Occidental Petroleum Corporation (NYSE:OXY) was also recently included in our list of the 10 Best Value Stocks to Buy in 2026 According to Warren Buffett.
4. Expand Energy Corporation (NASDAQ:EXE)
Number of Hedge Fund Holders: 81
Formed in 2024 by the merger of Chesapeake Energy Corporation and Southwestern Energy Company, Expand Energy Corporation (NASDAQ:EXE) operates as an independent natural gas production company in the United States.
On May 26, Barclays analyst Betty Jiang downgraded Expand Energy Corporation (NASDAQ:EXE) from ‘Overweight’ to ‘Equal Weight’, while also trimming the firm’s price target on the stock from $127 to $110. The lowered target still indicates an upside of over 18% from the current levels.
According to Barclays, the downgrade was driven by its reduced outlook for natural gas, as well as the “less visible path” for near-term catalysts for expansion. The analyst highlighted that the company’s value creation is increasingly reliant on gas marketing and commercial optimization, which increases its exposure to market conditions and timing.
Expand Energy Corporation (NASDAQ:EXE) exceeded Wall Street estimates in its Q1 2026 report in April, driven primarily by the higher natural gas prices during Winter Storm Fern. The company reaffirmed its full-year 2026 target to deliver 7.5 Bcf a day of natural gas at $2.85 billion of CapEx.
3. The Williams Companies, Inc. (NYSE:WMB)
Number of Hedge Fund Holders: 84
The Williams Companies, Inc. (NYSE:WMB) operates as an energy infrastructure company primarily in the United States, handling approximately one-third of the natural gas in the country.
On May 29, Argus upped the firm’s price target on The Williams Companies, Inc. (NYSE:WMB) from $83 to $85, while maintaining a ‘Buy’ rating on the shares. The target boost represents an upside of 19% from the current price level.
The Williams Companies, Inc. (NYSE:WMB) delivered a 22% YoY growth in adjusted EPS and 13% rise in adjusted EBITDA in its Q1 2026 report on May 4. Argus highlighted that the surge in earnings was driven by the strength in the company’s Transmission, Power, and Gulf segment, supported by the higher net rates and expansion projects at Transco and new Gulf volumes. Transco grew about 10% YoY during the quarter.
The analyst firm also noted Williams’ strong dividend history. The company has paid a common stock dividend every quarter since 1974 and currently boasts a robust annual dividend yield of 2.94%. Argus added that it considers the payout safe and sustainable in the current energy backdrop.
Carillon Tower Advisers, an investment management company, stated the following regarding The Williams Companies, Inc. (NYSE:WMB) in its Q1 2026 investor letter:
“The Williams Companies, Inc. (NYSE:WMB) shares benefitted from the conflict in the Middle East, which sent commodity prices of crude oil and natural gas to multi-year highs. We estimate that 10% to 15% of total supply could be removed from the global market for an extended period. Williams has limited commodity exposure, but the company should benefit from higher volumes moving through its vast pipeline system. The US natural gas market is incrementally viewed across the world as the most secure source. Williams is well placed to benefit from any improved volumes in the liquefied natural gas (LNG) export market.”
2. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 94
Exxon Mobil Corporation (NYSE:XOM) is one of the largest integrated fuels, lubricants, and chemical companies in the world.
On May 27, Mizuho hiked its price target on Exxon Mobil Corporation (NYSE:XOM) from $159 to $175, but maintained its ‘Neutral’ rating on the shares. The target boost indicates an upside of 24% from the current share price.
According to Mizuho, the Middle East conflict can have a prolonged impact on the global oil prices and refining margins. As a result, it raised its oil price outlook for 2026 and 2027 by 25% and 6%, respectively. The firm also increased its forecast for US refining cracks by 61% and 51%.
Similarly, earlier on May 26, Barclays analyst Betty Jiang also lifted the firm’s price target on Exxon Mobil Corporation (NYSE:XOM) from $163 to $182, while keeping an ‘Overweight’ rating on the shares. The revision comes after the firm adjusted its rating and price targets across the integrated oil and E&P group.
With an impressive annual dividend yield of 2.84%, Exxon Mobil Corporation (NYSE:XOM) was also recently included in our list of the 12 Best Blue Chip Dividend Stocks to Buy Now.
1. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 103
Topping our list of the Best Oil and Gas Stocks is Chevron Corporation (NYSE:CVX). The company manufactures and sells a range of high-quality refined products, including gasoline, diesel, marine and aviation fuels, premium base oil, finished lubricants, and fuel oil additives.
Chevron Corporation (NYSE:CVX) has received significant positive attention from analysts over the last week. On May 27, Mizuho analyst Nitin Kumar raised the firm’s price target on the stock from $225 to $230, while maintaining an ‘Outperform’ rating on the shares. The revised target, which reflects an upside of 26% from the current levels, comes after the analyst firm raised its outlook on global oil prices and US refining margins amid the Middle East crisis.
Similarly, earlier on May 26, Barclays also upped its price target on Chevron Corporation (NYSE:CVX) from $192 to $213, but kept an ‘Equal Weight’ rating on the shares. The analyst firm believes that the depleting inventories, shrinking spare capacity within OPEC, and a “muted” US supply response to the Middle East disruptions are contributing to a tighter oil macro environment that is not yet fully reflected in the valuations of energy stocks.
Lastly, on May 22, Morgan Stanley also boosted its price target on Chevron Corporation (NYSE:CVX) by $2, while keeping its ‘Overweight’ rating (read more details here).
While we acknowledge the potential of CVX to grow, 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 CVX and that has 100x upside potential, check out our report about the cheapest AI stock.
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