ConocoPhillips (COP) – Buy
I started a small position in ConocoPhillips (COP) last week and I will consider adding to it if the share price/ oil price continue to fall as I believe it will rebound eventually . In the meantime, ConocoPhillips has a great dividend of 4.63% and the payout is about 50% so there’s a decent margin of safety there for the dividend.
I think ConocoPhillips being one of the larger players in oil should allow it to survive a prolonged lower price in oil and allow it to be stronger once the price of oil rebounds as weaker competitors are consolidated.
Here is what to like about ConocoPhillips:
- High dividend with low payout.
- Low cost of supply – meaning it can handle lower prices in oil better than competitors.
- Plenty of cash to maintain operations and dividend.
- Great balance sheet and credit rating.
- More upside in stock price due to current pessimism in the oil industry.
Read the article “Why I’m Buying More of ConocoPhillips’ Stock” and the Trefis report for more analysis on ConocoPhillips.
