The sharp drop in oil prices has created a long-term buying opportunity in these large-cap oil and gas companies. Oil prices will eventually stabilize and will enable the large-cap oil and gas companies to get back into full throttle. These companies have low valuations, great long term upside potential and sustainable dividend yields.
1. Total (TOT)
Total SA is a global integrated oil and gas company based in France. The company operates through three segments, Upstream, Refining & Chemicals and Marketing & Services. Total has big investments in Liquefied Natural Gas(LNG) and Liquefied Petroleum Gas(LPG) all around the world. The company pays a healthy dividend yield of 5.30 percent.Current Price: $51.81 Trailing P/E: 27.90 Forward P/E: 13.62 Price Target: $59.30
2. BP PLC (BP)
BP is a international integrated oil and gas company based in United Kingdom. BP’s operates through three segments, Upstream, Downstream and Rosneft. The Rosneft segment engages in the exploration and production of oil and gas in the United States, Canada, Vietnam, Venezuela, Brazil, Algeria, the United Arab Emirates, Turkmenistan, and Norway. The company has recovered from the 2010 gulf offshore spill. BP has settled most of its oil spill lawsuits and is now investing in its business. The company pays a great dividend yield of 5.90 percent.
3. Exxon Mobil (XOM)
Exxon Mobil is the largest oil and gas company by market capitalization. The company is based in Houston, Texas. The Company engages in energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products. Exxon has great operating margins and continues to invest in oil and gas properties. Exxon’s dividend yield is lower than the other companies on the list but still very good.Current Price: $88.00 Trailing P/E: 11.59 Forward P/E: 16.73 Yield: 3.30% Price Target: $98
4. Chevron Corporation (CVX)
Chevron is a global energy company engaged in petroleum operations, chemicals operations, mining operations, and power and energy services. Chevron is based in San Ramon, California. Chevron has over $16 billion assets under advisory and plans to increase their oil production by 20 percent in the next two years. Chevron pays a dividend yield of 4 percent.Current Price: $110.38 Trailing P/E: 10.88 Forward P/E: 17.37 Yield: 4.0% Price Target: $125.50