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Coterra Energy (CTRA) and Devon Energy (DVN) to Merge in an All-Stock Deal Worth $58 Billion

Coterra Energy Inc. (NYSE:CTRA) is one of the Best Cheap Stocks to Buy Right Now.

Coterra Energy and Devon Energy announced on February 2 a $58 billion all-stock merger, which would make the combined company one of the largest shale producers in the Permian Basin. Combined, these companies currently produce an equivalent of 1.6 million barrels of oil per day. As part of the deal, Coterra shareholders will receive 0.70 shares for each share held. Devon will effectively own 54% of the combined company.

On the announcement, Clay Gaspar, Devon’s President and CEO, said,

We’ve now built a diverse asset base of high-quality, long-duration inventory to drive resilient value creation and returns for shareholders through cycles. Underpinned by our leading position in the best part of the Delaware Basin and a deep set of complementary assets, we expect to capture annual pre-tax synergies of $1 billion. This will drive higher free cash flow and greater shareholder returns beyond what either company could achieve alone.

Several firms updated their target prices for Coterra Energy immediately after the deal announcement. Susquehanna raised its target price to $34 (up from $32) and maintained a “Positive” rating. The firm also noted that it expects this merger to be value accretive.

Roth Capital, meanwhile, trimmed its target price to $28 (down from $30). They noted that they do not expect other players such as ConocoPhillips, Chevron, or EOG Resources to make their own bid for Coterra Energy.

Still, on the topic of target prices, CNN’s data show that 25 of 31 analysts (~81%) covering CTRA have a “Buy” rating, with the remaining six (~19%) having a “Hold” recommendation. The median target price is $33 (with a high of $40), implying an upside of 17.21% (42.07% if using the highest estimate).

Coterra Energy Inc. (NYSE:CTRA) is an independent oil and gas company operating in the Permian Basin.

While we acknowledge the risk and potential of Coterra Energy Inc. (NYSE:CTRA) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CTRA and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 12 Best Software Infrastructure Stocks to Buy According to Hedge Funds and Cathie Wood’s Stock Portfolio: Top 10 Stocks to Buy.

Disclosure: None. This article is originally published at Insider Monkey.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

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