In this article, we discuss the 10 oil and gas stocks to buy in billionaire Steve Cohen’s portfolio.
Steve Cohen is an American investor, businessman, philanthropist, and avid art collector. He is currently the Chairman, CEO, and Founder of Point72 Asset Management. He was born on June 11, 1956, in New York. His father worked as a manufacturer in Manhattan’s Garment Centre. Steve Cohen mainly gives credit to his high school poker playing days for teaching him risk-taking strategies.
Steve Cohen received his undergraduate degree in economics from Wharton School at the University of Pennsylvania in 1978. Soon after receiving his degree, he started working as a junior trader at Gruntal & Co and made an $8000 profit on the first day of his job. Cohen worked at Gruntal &Co. till 1992, in between which he managed to run his own trading group at the firm with a $75 million portfolio.
Point72 Asset Management is based in Stamford, Connecticut, and invests in discretionary long/short, macro, and systematic strategies. The fund has around 1500 employees and $117.54 billion in discretionary assets under management. According to the third-quarter 2021 13F filings, Point72 Asset Management had $22.768 billion in managed 13F securities. In the third quarter, the fund made 381 new stock purchases and increased holdings in 304 stocks. Moreover, the fund sold out of 307 stocks and reduced holdings in 255 stocks.
Meta Platforms, Inc. (NASDAQ:FB), Microsoft Corporation (NASDAQ:MSFT), and Visa Inc. (NYSE:V) are some of the most significant names in the Point72 Asset Management portfolio.
Our Methodology
With this context in mind, here is a list of 10 oil and gas stocks in billionaire Steve Cohen’s Point72 Asset Management portfolio. The stocks have been picked from Point72 Asset Management’s portfolio.
The hedge fund sentiment around each stock has been taken from the data of 867 hedge funds tracked by Insider Monkey. Analyst ratings and business fundamentals have also been added to help readers understand the stocks better.
10 Oil and Gas Stocks in Billionaire Steve Cohen’s Portfolio
10. Equinor ASA (NYSE:EQNR)
Point72 Asset Management’s Stake Value: $34.33 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.15%
Number of Hedge Fund Holders: 11
Equinor ASA (NYSE:EQNR) is a state-owned Norwegian petroleum company. Moreover, the company also has investments in the renewable energy sector and operates in 36 countries around the world. The company has around 170 million customers and houses more than 20,000 employees.
According to the third quarter 2021 13F filings, Point72 Asset Management owns 1.346 million shares of Equinor ASA (NYSE:EQNR) worth $34.33 million, comprising 0.15% of the fund’s portfolio. Although the fund has decreased its activity in the company by 20% in the third quarter.
According to Insider Monkey’s hedge fund database, 11 hedge funds held stakes worth $163.32 million in Equinor ASA (NYSE:EQNR) in the third quarter of 2021.
Meta Platforms, Inc. (NASDAQ:FB), Microsoft Corporation (NASDAQ:MSFT), and Visa Inc. (NYSE:V) are some of the notable names along with Equinor ASA (NYSE:EQNR) in Point72 Asset Management’s portfolio.
Massif Capital mentioned Equinor ASA (NYSE:EQNR) in their second-quarter 2021 investor letter. Here is what the firm said:
“We currently have two oil-related positions in our portfolio and believe the oil opportunity set is ripe. As one might expect, both positions, (including Equinor: EQNR) performed well during the second quarter, given the steady march higher that oil has made in recent months. We maintain a positive outlook for both companies, although, importantly, our posture is not predicated on an expectation for continued oil price appreciation. This is not because of our inability to imagine scenarios where that does occur, but more out of an abundance of caution for what is a highly volatile commodity that at current price levels should be more than sufficient to generate ample free cash flow for any investable oil firm.
In the future, we expect both firms in the portfolio to generate significant free cash flow and expect EQNR to reinvest that free cash flow into a combination of offshore oil and wind opportunities with high rates of return. The path forward for AOI is more complicated and does warrant a few comments.”
9. Suncor Energy Inc. (NYSE:SU)
Point72 Asset Management’s Stake Value: $34.36 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.15%
Number of Hedge Fund Holders: 32
Suncor Energy Inc. (NYSE:SU) is an integrated energy company founded in 1919 and headquartered in Calgary, Alberta, Canada. The company develops and produces oil and natural gas in some parts of North America, the North Sea, Libya, Syria, Tobago and Trinidad. Suncor Energy Inc. (NYSE:SU) has around 12,600 employees and ranks at 647 in Forbes Global 2000 in 2021.
At the end of the third quarter of 2021, the EPS of Suncor Energy Inc. (NYSE:SU) was $0.57 as estimated by the analysts. Although, the company missed the revenue estimates after generating $8.26 billion compared to $8.35 billion forecasts.
On November 19, Suncor Energy Inc.’s (NYSE:SU) price target was raised by Scotiabank analyst Jason Bouvier to $37 up from $33 and the analyst kept an Outperform rating on the company’s shares.
8. Targa Resources Corp. (NYSE:TRGP)
Point72 Asset Management’s Stake Value: $35.30 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.15%
Number of Hedge Fund Holders: 26
Targa Resources Corp. (NYSE:TRGP) is a Texas-based energy infrastructure company. The company mainly transports, stores, and does wholesale marketing of natural gas and natural gas liquids and is one of the largest midstream energy infrastructure companies in the United States. Targa Resources Corp. (NYSE:TRGP) is a Fortune 500 company that employs close to 2,400 people.
According to 2021 13F filings for the third quarter, Point72 Asset Management owns 717,388 shares of Targa Resources Corp. (NYSE:TRGP) worth $35.30 million, representing 0.15% of the fund’s portfolio.
Out of 867 hedge funds tracked by Insider Monkey, 26 of them hold stakes in Targa Resources Corp. (NYSE:TRGP) worth $567.25 million.
7. WEC Energy Group, Inc. (NYSE:WEC)
Point72 Asset Management’s Stake Value: $40.21 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.17%
Number of Hedge Fund Holders: 31
WEC Energy Group, Inc. (NYSE:WEC) is an American diversified utilities company headquartered in Wisconsin, United States. The company has around 4.4 million electricity and natural gas customers in Wisconsin, Illinois, Minnesota, and Michigan.
As of the third quarter of 2021, Israel Englander’s Millennium Management holds the largest stake in WEC Energy Group, Inc. (NYSE:WEC) 1.07 million shares worth $94.45 million, making up about 0.05% of Millennium Management’s portfolio.
6. Ovintiv Inc. (NYSE:OVV)
Point72 Asset Management’s Stake Value: $43.06 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.18%
Number of Hedge Fund Holders: 44
Ovintiv Inc. (NYSE:OVV) is Canada’s largest hydrocarbon exploration company. It is headquartered in Calgary, Alberta and it mainly focuses on petroleum, natural gas, and natural gas liquids. The company owns around 1.68 million net acres of land in Canada. In 2019, Ovintiv Inc. (NYSE:OVV) acquired the Texas-based Newfield Exploration after selling its assets in San Juan Basin.
At the end of the third quarter of 2021, the EPS of Ovintiv Inc. (NYSE:OVV) was $1.50 compared to $1.51 forecasts. Furthermore, the company also missed the revenue estimates by $134.55 million after generating $1.79 billion, compared to $1.92 billion estimates.
On October 26, Mizuho analyst Vincent Lovaglio raised the price target of Ovintiv Inc. (NYSE:OVV) from $42 to $54 and kept a Buy rating on the company’s shares. Due to unconventional oil growth in the United States, the analyst increased the price target of several companies related to hydrocarbon exploration.
Ovintiv Inc. (NYSE:OVV) is one of the important companies besides Meta Platforms, Inc. (NASDAQ:FB), Microsoft Corporation (NASDAQ:MSFT), and Visa Inc. (NYSE:V) in Point72 Asset Management’s portfolio.
5. BP p.l.c. (NYSE:BP)
Point72 Asset Management’s Stake Value: $46.31 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.2%
Number of Hedge Fund Holders: 29
BP p.l.c. (NYSE:BP) is a British oil and gas company formerly known as The British Petroleum company. It is one of the world’s seven “supermajors” in the oil and gas industry. The company works across all major sectors of the oil and gas industry including exploration, extraction, refining, distribution, and power generation in around 80 countries across the globe.
At the end of the third quarter of 2021, Ken Fisher’s Fisher Asset Management holds the highest position in BP p.l.c. (NYSE:BP) with 12.635 million shares worth $345.32 million. Additionally, Point72 Asset Management owned 1.69 million shares of the company worth $46.31 million, representing 0.2% of the fund’s portfolio. Point72 Asset Management also increased its activity in BP p.l.c. (NYSE:BP) by 161% in the third quarter of 2021.
BP p.l.c. (NYSE:BP) recently stepped into the global “net-zero emissions by 2050” race after announcing to acquire Amply Power, an EV charging, and energy infrastructure, provider. The amount for the acquisition of Amply Power has not been disclosed yet.
4. Sempra (NYSE:SRE)
Point72 Asset Management’s Stake Value: $58.32 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.25%
Number of Hedge Fund Holders: 23
Sempra (NYSE:SRE) is a California-based energy infrastructure company. It primarily focuses on electricity and natural gas infrastructure. The company operated across North and South America up until June 2020, after which it exited the South American market after selling its business in Chile.
Sempra (NYSE:SRE) beat the EPS estimates by $0.01 in the third quarter of 2021. The EPS of the company was $1.70, compared to the $1.69 forecast. On top of that, the company generated $3.01 billion in revenue, beating the estimates of $2.75 billion by 9.74%.
On October 19, Sempra’s (NYSE:SRE) price target was lowered by Mizuho analyst Anthony Crowdell to $139 down from $154; however, the analyst kept a Buy rating on the company’s shares.
Sempra (NYSE:SRE) was mentioned by ClearBridge Investments in their second-quarter 2021 investor letter. Here are the contents of the letter:
“Over the last year we have increased our exposure to utilities and during the quarter we continued to build out our position in Sempra. We added to utilities during the depths of the pandemic as their stocks sold off despite the defensive nature of their businesses. In a world of uncertainty, utilities offered predictable results with an attractive entry point. Our investment thesis in utilities, however, is not merely defensive; we believe utilities are one of the best ways to capitalize on the energy transition as the world decarbonizes and electrifies. As we move to electric vehicles and renewable power, the world will see tremendous investment in electric infrastructure. Utilities will build the grids of the future and this investment should drive attractive earnings growth for decades. We have focused our utilities investments in states with aggressive green policy initiatives that will drive strong growth.”
3. DT Midstream, Inc. (NYSE:DTM)
Point72 Asset Management’s Stake Value: $70.25 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.3%
Number of Hedge Fund Holders: 22
DT Midstream, Inc. (NYSE:DTM) is a US-based midstream natural gas company. The company was founded in 2021 and operates in Northeastern and Midwestern United States and Canada. DT Midstream, Inc. (NYSE:DTM) owns gas storage assets with a capacity of 94 Bcf, in addition to 290 miles of lateral pipelines.
At the end of the third quarter of 2021, Point 72 Asset Management held 1.52 million shares of DT Midstream, Inc. (NYSE:DTM) worth $70.25 million, representing 0.3% of the fund’s portfolio. Point72 Asset Management holds the third biggest position in the company’s shares after Zimmer Partners and Sessa Capital.
The hedge fund sentiment towards DT Midstream, Inc. (NYSE:DTM) increased drastically in the third quarter of 2021 with 22 hedge funds having stakes worth $482.42 million, compared to 4 worth $13.166 million in the previous quarter.
2. Dominion Energy, Inc. (NYSE:D)
Point72 Asset Management’s Stake Value: $83.97 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.36%
Number of Hedge Fund Holders: 27
Dominion Energy, Inc. (NYSE:D) is an American energy company that supplies electricity in Virginia and North and South Carolina. Additionally, the company provides natural gas in several states across the United States.
Diamond Hill Capital which is owned by Ric Dillon held the most significant stake in Dominion Energy, Inc. (NYSE:D) in the third quarter of 2021. Diamond Hill Capital owned 3.72 million shares worth $271.76 million of Dominion Energy, Inc. (NYSE:D), representing 1.03% of the fund’s portfolio.
1. Cenovus Energy Inc. (NYSE:CVE)
Point72 Asset Management’s Stake Value: $94.818 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.41%
Number of Hedge Fund Holders: 30
Cenovus Energy Inc. (NYSE:CVE) is a Canadian oil and natural gas company founded in 2009. The company primarily focuses on its oil sands assets, refining, and transportation. In January 2021, Cenovus Energy Inc. (NYSE:CVE) acquired Husky Energy (TSX:HSE) for 3.9 billion.
According to the third-quarter 2021 filings, the EPS of Cenovus Energy Inc. (NYSE:CVE) was $0.31 compared to $0.38 estimates. Nonetheless, the company beat the revenue forecast by $1.35 billion in the same quarter. Cenovus Energy Inc. (NYSE:CVE) generated a revenue of $10.84 billion compared to $9.49 billion estimates.
On November 19, Scotiabank analyst Jason Bouvier raised the price target for Cenovus Energy Inc. (NYSE:CVE) from $16.50 to $19 and kept an Outperform rating on its shares.
You can also take a peek at Echo Street Capital Management: Greg Poole’s Top 10 Stock Picks and 10 Healthcare Stocks to Buy According to Peter S. Park’s Park West Asset Management.
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Disclosure. None. 10 Oil and Gas Stocks in Billionaire Steve Cohen’s Portfolio is originally published on Insider Monkey.
