Billionaire Mario Gabelli’s 10 Large-Cap Stock Picks with Huge Upside Potential

2. ConocoPhillips (NYSE:COP)

Gamco Investors Equity Stake: $5.06 Million

Market Capitalization as of May 5: $110.75 Billion

Stock Upside Potential as of May 6: 39.58%

Number of Hedge Fund Holders: 85

ConocoPhillips (NYSE:COP) is an independent exploration and production (E&P) company that explores, produces, transports, and markets crude oil, bitumen, natural gas, and liquefied natural gas (LNG). Last year, the company acquired Marathon Oil, adding high-quality and low-cost oil supply inventory. With the acquisition, it is well-positioned to achieve $1 billion of run-rate synergies.

The acquisition lifted the company into the top tier of US oil and natural gas producers. Likewise, it boasts the second-largest land inventory to develop at a relatively low average cost of $30 a barrel. That may explain why ConocoPhillips (NYSE:COP) has remained resilient despite oil prices plunging below $70 a barrel. UBS analyst Josh Silverstein maintained a Buy rating on the stock on expectation of growth in cash flow from major projects and a $10 billion return on capital.

ConocoPhillips (NYSE:COP) plans to increase its dividend dramatically and boost its share buybacks, hiking dividends by 34% and upping its buyback authorization to $20 billion. The stock currently yields 3.41% on dividends, much higher than the S&P 500 average of 1.4%.