5-Star Stocks Poised to Pop: ConocoPhillips
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, oil and gas giant ConocoPhillips (NYS: COP) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Conoco's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Houston (1917)|
|Market Cap||$101.8 billion|
|Industry||Integrated oil and gas|
|Trailing-12-Month Revenue||$212 billion|
|Management||Chairman/CEO James Mulva|
CFO Jeff Sheets
|Return on Capital (Average, Past 3 Years)||11.2%|
|Cash/Debt||$8.4 billion / $28 billion|
|Competitors||Chevron (NYS: CVX) |
ExxonMobil (NYS: XOM)
Occidental Petroleum (NYS: OXY)
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 5,498 members who have rated Conoco believe the stock will outperform the S&P 500 going forward. These bulls include MistaMoFo and All-Star TMFDeej, who is ranked in the top 1% of our community.
Just last month, MistaMoFo highlighted Conoco as a particularly special situation: "Upcoming business split between exploration/production and refining/distribution operations will exploit the intrinsic value of their respective operations. They know how to do it, and they see the potential in this move."
In fact, Conoco currently sports a cheapish P/E of 8.7. That represents a discount to competitors like Chevron (10.1), Exxon (11.4), and Occidental (16).
CAPS All-Star TMFDeej expands on the opportunity:
Normally I would be interested in shares of the divisions that are being spun-off, but in this instance I love this move from the parent company's perspective. I have a very low opinion of the refining and remarketing sectors of the energy world. Yes, crack spreads are massive right now and refiners are making a ton of money, but they are so cyclical and can easily turn around. Besides, while I realize that the sector produces more than just gasoline and that some of COP's refineries are outside of the U.S., it can't be a good thing for business when one has the government working against the use of their product in the form of ever increasing federal gas mileage standards.
Marathon Oil saw its shares surge 65% after it announced a similar plan to separate its E&P and refining businesses. I highly doubt that COP will see its share price increase by that much in the short-run, but I still really like the move.
What do you think about Conoco, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
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