Top Large-Cap Oil and Gas Producer Stocks: A Wall Street Transcript Interview with Pavel Molchanov of Raymond James & Associates, Inc.

Wall Street Transcript

67 WALL STREET, New York - March 3, 2014 - The Wall Street Transcript has just published its Oil & Gas: Refining, Independent and Major Integrated Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Oil Price Expectations - Unconventional Resources - Capital Expenditures and Consolidation Activity - Oil and Gas - Emerging Shale Plays - Shale Drilling Capital Expenditures - Independent E&P Opportunities

Companies include: Chevron Corp. (CVX), Exxon Mobil Corp. (XOM), Occidental Petroleum Corporati (OXY), Petroleo Brasileiro (PBR), Cheniere Energy, Inc. (LNG), Total SA (TOT), BP plc (BP), Anadarko Petroleum Corp. (APC), Apache Corp. (APA), Marathon Oil Corporation (MRO), ConocoPhillips (COP), Murphy Oil Corporation (MUR)

In the following excerpt from the Oil & Gas: Refining, Independent and Major Integrated Report, an expert analyst discusses the outlook for the sector for investors:

TWST: Should investors be buying these stocks at this point?

Mr. Molchanov: Yes, but only on a selective basis. We think that there are some opportunities, particularly after the selloff that has been seen across the energy complex since the beginning of the year. So we certainly do not want to recommend all of them or even most of them, but yes, in some cases there are good opportunities.

In thinking about large-cap multinationals, our top pick right now - actually one of the very few strong "buys" we have - is Chevron, which is close to a 52-week low. Chevron has been beaten down quite a bit. Sentiment has turned very sour partly because the company's production guidance for this year has been somewhat disappointing. And the dividend yield, 3.6%, is the highest it's been since 2012, and that's even before the upcoming dividend increase, which traditionally happens in April. So from a total return standpoint we like Chevron the best.

TWST: Are investors turned on?

Mr. Molchanov: Again, just generally oil and gas stocks have underperformed over the past six weeks or so, partly on concerns about oil prices, but these are also stocks that had a good year last year, and there has been a degree of profit-taking. Again, in the case of Chevron, the production guidance was on the disappointing side, and that alone cost the stock about 4% in one day's trading. So that would be our top pick.

Other megacaps that we like are Exxon and Total (TOT). And we would be more neutral on Petrobras and BP (BP). And then below the megacaps, looking at large caps, there is obviously a broader set of companies to choose from. Among the companies that we recommend are Occidental Petroleum, Anadarko Petroleum (APC), Apache (APA) and Marathon Oil (MRO), and we would be neutral on some of the stocks...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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