ConocoPhillips (COP)
Our analysis: COP rated Strong Buy
A Strong Buy driven by structural under-pricing of the company's through-cycle free cash flow capability.
Bull: A prolonged period of underinvestment in conventional oil supplies combined with resilient global demand creates structural support for elevated commodity prices, leading to sustained margin expansion and aggressive capital returns via buybacks.
Demand Destruction: Permanent structural demand destruction driving long-term realized oil prices persistently below $50/bbl.
Strong Buy based on a roughly 20% premium to internal valuation cross-checks, supported by highly competitive asset quality and durable free cash flow generation.
Position sizing playbook →| Market cap | $138.7B | |
|---|---|---|
| Revenue (ttm) | 59.4B | |
| Net income (ttm) | 7.3B | |
| EPS (ttm) | $5.88 | |
| Shares out | 1.2B | |
| P/E (trailing) | 19.4x | |
| P/E (forward) | 13.1x | |
| Dividend | $3.36 (2.95%) | |
| Volume | 8,009,273 | |
| Beta | 0.15 | |
| Price target | $124 | +8.9% |
Price
Recent price action with selectable time range.
Financial snapshot
- Revenue (ttm)
- 59.4B
- Net income (ttm)
- 7.3B
- EPS (ttm)
- $5.88
- P/E (trailing)
- 19.4x
- P/E (forward)
- 13.1x
- Market cap
- $138.7B
| Item | P1 | P2 | P3 | P4 | P5 | Trend |
|---|---|---|---|---|---|---|
| Period | 2021-12-31 | 2022-12-31 | 2023-12-31 | 2024-12-31 | 2025-12-31 | Trend |
| Revenue | $45.83B | $78.49B | $56.14B | $54.75B | $58.94B | +6.5% |
| Gross profit | $14.77B | $30.01B | $18.20B | $16.38B | $14.79B | +0.0% |
| Operating income | $12.07B | $25.46B | $15.03B | $12.78B | $11.34B | -1.5% |
| Net income | $8.08B | $18.68B | $10.96B | $9.25B | $7.99B | -0.3% |
| EPS (diluted) | — | $14.57 | $9.06 | $7.81 | $6.35 | -18.7% |
| EBITDA | $21.09B | $37.13B | $25.78B | $24.43B | $25.57B | +4.9% |
| R&D | — | — | — | — | — | — |
| SG&A | $719.0M | $623.0M | $705.0M | $1.16B | $893.0M | +5.6% |
Fair-value bridge
- Fair value (low)
- $127
- Fair value (mid)
- $169
- Fair value (high)
- $218
- Current price
- $114
- Upside to mid
- +48.0%
Valuation models
| Model | Fair value (mid) | Weight |
|---|---|---|
| Forward earnings | $115 | 60% |
| FCFF DCF | $232 | 30% |
| Owner earnings | $300 | 10% |
| Reverse DCF | $0.00 | 0% |
| Discounted earnings | $324 | 0% |
| Peg adjusted peer | $92.57 | 0% |
| Ddm | $101 | 0% |
Analyst consensus
Latest news · COP
Recent company headlines from major financial publishers.
Valuation
- Market cap
- $138.7B
- P/E (trailing)
- 19.4x
- P/E (forward)
- 13.1x
- P/S
- 2.3x
- P/B
- 2.1x
- PEG
- 1.34
- EV / EBITDA
- 6.7x
Profitability
- Gross margin
- 45.6%
- Operating margin
- 19.5%
- ROE
- 11.3%
- ROA
- 5.9%
- ROIC
- 9.0%
Balance sheet
- Debt / equity
- 0.36
- Current ratio
- 1.29
- Quick ratio
- 1.07
Trading
- Beta
- 0.15
- Volume
- 8,009,273
- Dividend yield
- 3.0%
Scenarios & expected return
A prolonged period of underinvestment in conventional oil supplies combined with resilient global demand creates structural support for elevated commodity prices, leading to sustained margin expansion and aggressive capital returns via buybacks.
- Prolonged period of underinvestment in conventional oil supplies.
- Resilient global demand creates structural support for elevated commodity prices.
- Sustained margin expansion and aggressive capital returns.
ConocoPhillips operates as a premier, large-scale cyclical E&P producer with a highly competitive low-cost asset base. Following peak conditions in 2022, near-term estimates reflect cyclical normalization; however, the company generates robust free cash flow capable of sustaining meaningful shareholder distributions even during mid-cycle environments.
- Near-term estimates reflect cyclical normalization.
- Company generates robust free cash flow capable of sustaining meaningful distributions.
- Mid-cycle pricing environment.
Accelerating energy transition dynamics and macroeconomic headwinds depress long-term oil and gas prices. Elevated capital requirements to combat natural decline rates severely compress free cash flow and terminal valuation multiples.
- Accelerating energy transition dynamics depress long-term prices.
- Macroeconomic headwinds reduce global demand.
- Elevated capital requirements compress free cash flow.
Valuation models & bridge
| Model | Weight | FV / share | vs spot | Contribution |
|---|---|---|---|---|
| Forward earnings | 60% | $115 | +0.9% | |
| FCFF DCF | 30% | $232 | +104.0% | |
| Owner earnings | 10% | $300 | +163.2% | |
| Reverse DCF | 0% | $0.00 | -100.0% | |
| Discounted earnings | 0% | $324 | +184.7% | |
| Peg adjusted peer | 0% | $92.6 | -18.7% | |
| Ddm | 0% | $101 | -11.3% | |
| Composite FV (weighted) | 100% | $169 | +48.0% |
Sensitivity: Ke × terminal growth
| Ke ↓ / g → | 1.0% | 1.5% | 2.0% | 2.5% | 3.0% |
|---|---|---|---|---|---|
| 3.2% | $244 | $295 | $295 | $295 | $295 |
| 4.2% | $169 | $199 | $244 | $295 | $295 |
| 5.2% | $129 | $146 | $169 | $199 | $244 |
| 6.2% | $104 | $115 | $129 | $146 | $169 |
| 7.2% | $92.7 | $95.2 | $104 | $115 | $129 |
Scorecard
| Category | Weight | Score | Reading |
|---|---|---|---|
| Valuation | 11% | 8.0 | |
| Management | 11% | 7.3 | |
| Balance Sheet | 11% | 6.0 | |
| Profitability | 11% | 5.5 | |
| Revenue Growth | 11% | 2.5 | |
| Risk Assessment | 11% | 7.5 | |
| Competitive Moat | 11% | 6.5 | |
| Earnings Quality | 11% | 6.0 | |
| Capital Efficiency | 11% | 6.5 |
Position sizing & entry playbook
- Trim exposure during periods of peak commodity pricing euphoria or structural degradation in capital discipline.
Next earnings
Upcoming earnings date and setup when available.