If any investor has stood the test of time, it is Warren Buffett. For years, the “Oracle of Omaha” has had a rock-star-like presence in the investing world. His annual Berkshire Hathaway shareholders meeting draws literally thousands of loyal fans who are investors. Known for his long buy-and-hold strategies and his massive portfolio of public and private holdings, Buffett remains one of the preeminent investors in the entire world.
One sector that Berkshire Hathaway continues to add to is energy, specifically Occidental Petroleum Corp. (NYSE: OXY) shares. Between May 25 and May 30, Buffett purchased 4.66 million shares of the stock for about $275 million. With the newest trades factored in, Buffett now holds 222 million shares worth around $13 billion, or a massive 24.9% stake in the company.
One likely reason for Buffett’s continued purchasing is that the top energy companies are cheap and flush with cash, and they have been cutting back on exploration and production costs. In addition, oil has traded sideways for almost all of 2023, and many feel a breakout to higher levels is on the way. Buffett is not the only one bullish on oil. BofA Securities commodities head of research feels that the second half of the year will see a surge in the price of oil and should be close to $90 a barrel by the end of 2023. Goldman Sachs sees $100 per barrel by April of 2024.
We screened our 24/7 Wall St. energy research looking for high-yielding mega-cap energy leaders and found five that look like solid bets for those not chasing the AI tech trade. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
This is one of the premier European integrated oil giants. BP PLC (NYSE: BP) engages in the energy business worldwide. It produces and trades in natural gas; offers biofuels; operates onshore and offshore wind power and solar power generating facilities; and provides de-carbonization solutions and services, such as hydrogen and carbon capture, usage and storage.
The company is also involved in the convenience and mobility business, which manages the sale of fuels to wholesale and retail customers, convenience products, aviation fuels, and Castrol lubricants. It is involved in refining, supply and trading of oil products, as well as operation of electric vehicle charging facilities. In addition, it produces and refines oil and gas, and it invests in upstream, downstream and alternative energy companies, as well as in advanced mobility, bio and low carbon products, carbon management, digital transformation and power and storage areas.
Investors receive a 4.48% dividend. Raymond James has a $48 target price on BP stock, and the consensus target is $44.68. The closing share price on Wednesday was $33.71.