In this article, we will take a look at the 5 most promising energy stocks according to analysts. To see more such companies, go directly to 12 Most Promising Energy Stocks According to Analysts.
5. W&T Offshore, Inc. (NYSE:WTI)
Number of Hedge Fund Holders: 21
One-Year Average Price Target: 10.20
W&T Offshore, Inc. (NYSE:WTI) is a Texas-based independent oil and natural gas company. In January 2023, W&T Offshore, Inc. (NYSE:WTI) closed a $275 million private offering of 11.75% senior second lien notes due 2026.
At the end of the fourth quarter of 2022, 21 hedge funds had stakes in W&T Offshore, Inc. (NYSE:WTI). The biggest hedge fund stakeholder of W&T Offshore, Inc. (NYSE:WTI) was D. E. Shaw with a $12.6 million stake.
4. Patterson-UTI Energy, Inc. (NASDAQ:PTEN)
Number of Hedge Fund Holders: 26
One-Year Average Price Target: 21.65
Energy-related equipment and services company Patterson-UTI Energy, Inc. (NASDAQ:PTEN) is one of the most promising energy stocks based on analyst price estimates.
Recently, investment firm UBS added Patterson-UTI Energy, Inc. (NASDAQ:PTEN) to its list of companies that are “de-risked” from earnings. UBS said that companies that are de-risked from earnings have better OCF vs earnings and have posted greater declines in their forward P/E and stronger three-month earnings revisions.
As of the end of the fourth quarter of 2022, 26 hedge funds out of the 943 funds tracked by Insider Monkey had stakes in Patterson-UTI Energy, Inc. (NASDAQ:PTEN). The total value of these stakes was $390 million. The biggest hedge fund stakeholder of Patterson-UTI Energy, Inc. (NASDAQ:PTEN) during this period was Ben Jacobs’ Anomaly Capital Management which has a $95 million stake in the firm.
3. SM Energy Company (NYSE:SM)
Number of Hedge Fund Holders: 31
One-Year Average Price Target: 45.58
Colorado-based energy company SM Energy Company (NYSE:SM) ranks 3rd in our list of the most promising energy stocks according to analysts. In February, SM Energy Company (NYSE:SM) posted strong Q4 results, according to which its adjusted EPS in the period totaled $1.29, beating estimates by $0.06. Revenue in the quarter fell 21.5% on a YoY basis but still beat analyst estimates by $56.6 million.
For full-year 2023, SM Energy Company (NYSE:SM) said it expects its production volumes to remain flat or grow by low single digits at 52.5-54.5 MMBoe.
At the end of the last quarter of 2022, 31 hedge funds tracked by Insider Monkey reported having stakes in SM Energy Company (NYSE:SM). The net worth of these stakes was $382 million. The biggest hedge fund stakeholder of SM Energy Company (NYSE:SM) was Marshall Wace LLP’s Paul Marshall and Ian Wace which had a $66 million stake in the firm.
2. Southwestern Energy Company (NYSE:SWN)
Number of Hedge Fund Holders: 44
One-Year Average Price Target: 9.94
Ranking 2nd in our list of the most promising energy stocks according to analysts is Southwestern Energy Company (NYSE:SWN). Southwestern Energy Company (NYSE:SWN) has a strong upside potential based on the average analyst price target. In February, Southwestern Energy Company (NYSE:SWN) posted Q4 results. Adjusted EPS in the period came in at $0.26, missing estimates by $0.02. Revenue in the period jumped about 14.6% on a YoY basis to reach $880 million.
At the end of the fourth quarter of 2022, 44 hedge funds had stakes in Southwestern Energy Company (NYSE:SWN). The total value of these stakes was about $824 million. The biggest hedge fund stakeholder of Southwestern Energy Company (NYSE:SWN) was DE Shaw with a $113.4 million stake.
1. Chesapeake Energy Corporation (NYSE:CHK)
Number of Hedge Fund Holders: 58
One-Year Average Price Target: 123.60
Chesapeake Energy Corporation (NYSE:CHK) ranks 1st in our list of the most promising energy stocks according to analysts. Chesapeake Energy Corporation (NYSE:CHK) recently posted its Q4 results. Adjusted EPS in the quarter totaled $4.22, beating estimates by $1.32. Adjusted EBITDAX came in at $1,032 million, while free cash flow totaled $526 million. Chesapeake Energy Corporation (NYSE:CHK) also announced that it will pay a quarterly dividend of $1.29 per common share in March.
As of the end of the fourth quarter of 2022, 58 hedge funds reported owning stakes in Chesapeake Energy Corporation (NYSE:CHK), according to Insider Monkey’s database of 943 hedge fund holdings. The biggest hedge fund stakeholder of Chesapeake Energy Corporation (NYSE:CHK) during this period was William B. Gray’s Orbis Investment Management which owns a $304 million stake in the company.
Carillon Tower Advisers made the following comment about Chesapeake Energy Corporation (NASDAQ:CHK) in its Q3 2022 investor letter:
“Chesapeake Energy Corporation (NASDAQ:CHK), a natural gas exploration and production company, emerged from bankruptcy with little fanfare in 2021, despite having rid itself of its debt burden and onerous pipeline contracts. The company was able to make two large acquisitions at very reasonable prices within its core producing areas, allowing for scale and cost savings. Then in 2022, natural gas prices began to rise well above expectations, increasing the value of Chesapeake’s large natural gas resources and production and contributing to its outperformance.”
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