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The Zacks Analyst Blog Highlights Diamondback Energy, Exxon Mobil, Chevron, Pioneer Natural Resources and Hess

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For Immediate Release

Chicago, IL – March 21, 2024 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Diamondback Energy, Inc. (FANG - Free Report) , Exxon Mobil Corp. (XOM - Free Report) , Chevron Corp. (CVX - Free Report) , Pioneer Natural Resources and Hess Corporation (HES - Free Report) .

Here are highlights from Wednesday’s Analyst Blog:

3 Stocks to Watch on Oil Companies' Rush to Drill on Land

The energy market has witnessed significant mega-merger deals as oil prices continue to stay in bullish territory. Oil and gas companies are swiftly pursuing additional drilling resources in key basins and shale plays, aiming to boost profits through increased production of these commodities.

High Oil Price & Merger Frenzy

The West Texas Intermediate crude has surpassed the $80 per barrel mark, which is highly conducive for exploration and production endeavors. Per the short-term energy outlook from the U.S. Energy Information Administration, the average spot price for West Texas Intermediate crude is likely to be $82.15 per barrel this year.

The handsome oil prices since Russia’s full-scale invasion of Ukraine two years ago in early 2022 and the conducive crude outlook may partly be prompting mega-merger deals in the energy space. Producing more of the commodity to capitalize on the promising crude prices will become comparatively easier while merging with rivals, thereby gaining rights to key oil and natural gas reserves.

3 Stocks in the Radar

We are highlighting three significant merger deals that have occurred, providing incentives for investors to monitor companies such as Diamondback Energy, Inc., Exxon Mobil Corp. and Chevron Corp. All the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Last month, the energy market witnessed a $26 billion deal between Diamondback Energy and Endeavor Energy Resources LP to create a leading oil and natural player in the Permian – the most prolific basin in the United States.

The merger will create significant shareholder value as the combined company will have a huge inventory of drilling sites and lower operating cost structures.

ExxonMobil has also entered into a staggering $59.5 billion all-stock deal to buy Pioneer Natural Resources, underscoring its motives to further strengthen its presence in the Permian. This is because Pioneer Natural is one of the foremost oil producers operating in the Permian Basin. With the deal closure, expected in the first half of 2024, Permian production of the integrated energy major will more than double to 1.3 million barrels of oil equivalent per day (MMBoE/D). Furthermore, ExxonMobil projected that this production figure will rise to an impressive 2 MMBoE/D by 2027.

Like ExxonMobil, Chevron also entered into a deal to diversify and upgrade its existing portfolio. Chevron inked a $53 billion agreement to acquire all the outstanding shares of Hess Corporation. Upon the completion of the agreement, likely to be in the first half of 2024, Chevron is set to acquire a 30% ownership interest of Hess in Guyana's Stabroek Block, which houses the most significant crude discovery of the past decade and stands as one of the most lucrative discoveries globally.

Last Words

It is positive that oil and gas companies will generate increased cash flows for investors, relying on synergies and low-cost structures and expanding their footprint in key resources. However, the million-dollar question that will linger is, "Will higher production of fossil fuels exceed the safe limit for greenhouse gas emissions?"

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release.

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