Is APA a good stock to buy? We came across a bullish thesis on APA Corporation on Indirect Costs’s Substack by Nemčik. In this article, we will summarize the bulls’ thesis on APA. APA Corporation’s share was trading at $40.80 as of March 24th. APA’s trailing and forward P/E were 9.80 and 17.86 respectively according to Yahoo Finance.
APA Corporation, an independent energy company, explores for, develops, and produces natural gas, crude oil, and natural gas liquids. APA represents a compelling bottom-cycle investment in the oil and gas sector, driven not merely by near-term crude price fluctuations but by a fundamental mispricing of a generational asset in Suriname and Guyana.
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The broader market has faced one of the highest risk premiums in recent memory, with geopolitical uncertainty paired with a global oil surplus that the International Energy Agency projected at nearly four million barrels per day in March 2026. While conventional wisdom might question investing in commodity producers amid a glut, APA’s strategic positioning and asset quality make it distinctive.
Early purchases in 2024 valued APA at an 8x P/E (or sub-4x unadjusted), providing a margin of safety while leaving upside optionality. In 2025, the company generated $4.5 billion in operating cash flow, up 26% from 2024, reduced net debt by $1.6 billion to $4.5 billion, repurchased $280 million of shares, and paid $360 million in dividends, demonstrating disciplined capital allocation and financial strength.
The centerpiece of APA’s upside is Block 58, or GranMorgu, a Tier-1, open-water, low-carbon offshore project in Suriname with estimated recoverable reserves of 750 million barrels and a breakeven of $35–$40 per barrel, substantially below North American onshore costs. By combining high-quality, low-cost assets with strong financial execution, APA is positioned to outperform, turning a deeply discounted, misunderstood company into a top-quartile asset in global oil production.
Previously, we covered a bullish thesis on Occidental Petroleum Corporation (OXY) by Magnus Ofstad in May 2025, which highlighted OXY’s low-cost Permian operations, diversified business model, and leadership in carbon capture. OXY’s stock price has appreciated by approximately 42.30% since our coverage. Nemčik shares a similar view but emphasizes APA Corporation’s generational offshore assets, disciplined capital allocation, and bottom-cycle opportunity.
APA Corporation is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held APA at the end of the fourth quarter which was 33 in the previous quarter. While we acknowledge the risk and potential of APA 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 APA and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
