ConocoPhillips (COP)

[Kerim]

Looking for thoughts and opinions -- is COP the crummy dog of a stock that its past few years would suggest, or is it just now finally coming out of the woods and ready to excel?

I bought my shares back before the PSX split, and just held on through the dividend cut and related misery. I'm tempted to dump what I've got to make room for some other moves, but I'd hate to let this go just before it starts a good run of years, earnings and dividend growth-wise. 

What do you think?

[RyanCMason]

(12-11-2018, 08:09 PM)Kerim Wrote: Looking for thoughts and opinions -- is COP the crummy dog of a stock that its past few years would suggest, or is it just now finally coming out of the woods and ready to excel?

I bought my shares back before the PSX split, and just held on through the dividend cut and related misery. I'm tempted to dump what I've got to make room for some other moves, but I'd hate to let this go just before it starts a good run of years, earnings and dividend growth-wise. 

What do you think?

I'm not a major fan of the stock as I prefer the integrated oil companies like XOM, CVX, and RDS.A/B.  COP will obviously outperform the Chevron's and Exxon when oil prices rise but also do very poor when oil prices drop.

[fenders53]

Now does not seem to be a great time to exit the sector, but that is dependent on future oil prices of course.  COP yield does not meet my personal requirements for a cyclical stock you will no doubt suffer through down cycles at some point.   I concur with Ryan's list of replacements.  BP probably qualifies as well.  I own CVX and BP currently.  COP may perform just as well in the short-term but the downside is less risky for the aristocrat majors, IMO.

[ChadR]

I would sell COP when oil prices are high. Hold on to it for now. Like the others, I like the integrated oil companies so much more. I own XOM, BP, CVX, RDS.A, & RDS.B and I will buy any of these before more COP.

[Kerim]

Thanks everyone. I'm thinking this might be a good covered call candidate, since I'd shed no tears if the shares were called away!

[fenders53]

(12-12-2018, 07:02 PM)Kerim Wrote: Thanks everyone. I'm thinking this might be a good covered call candidate, since I'd shed no tears if the shares were called away!

That's what I would do.  Maybe just wait for it to run a few bucks before you do it.  They say there is no such thing as an oversold commodity, but I'd sure like to think there is more upside than downside from here for most any oil stock.  It least in the next few months.

[Phidius]

$COP is an exploration company, I believe you should keep it if you have other complimentary oil stocks such as pipelines and oil retailers or producers. The better exploration option is $EOG, but Conoco is priced better for market take-off. Their buyback program will boom the stock if you can wait it out. OPEC recently agreed to reduce oil production, but not a huge amount, just enough to acknowledge overproduction levels.

Sell a couple shares if you need free cash flow, but I still favor the stock. Current price is just market sentiment on oil, it will rebound for sure. Check out this stock review when stock was at $78: https://youtu.be/ldu9Up2eml0



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[EricL]

I think COP is a decent enough company, but I like OXY and EOG better for E&P's.

[fenders53]

Current market price of oil is acknowledgement the world continues to have too much supply capacity. It's not a new problem.
Perhaps five countries are now capable of depressing oil if they are not prudent enough to avoid it. Only thing that changes this is significant expansion of the world economy which is far from guaranteed. 90 days ago $80-100 oil was predicted in 2019 and that is proof you have to be careful who's opinion you use to make investment decisions. Here we are now, not much over half that wild prediction.