Goldman Sachs is the acknowledged leader in the investment landscape on Wall Street and worldwide. The firm’s top-notch research department continues to provide institutional and high-net-worth clients with the best ideas across the investment spectrum and is likely to do so for years to come. Founded in 1869, Goldman Sachs is the world’s second-largest investment bank by revenue and ranks 32nd on the Fortune 500 list of the largest U.S. corporations by total revenue. The Wall Street white-glove giant offers financing, advisory services, risk distribution, and hedging for the firm’s institutional and corporate clients. In addition, it provides advice, investing, and execution for institutions and individuals across public and private markets. At 24/7 Wall St., we have followed the company’s research for 15 years to bring our readers top stock ideas.
With war raging in the Middle East and oil prices soaring, we were eager to see Goldman Sachs’ top picks across a wide range of energy subsectors. Five top companies are strong buys, and all make sense for investors looking to add energy now and also willing to add solid companies for long-term sector strength. The top energy picks at Goldman Sachs range from a large-cap exploration and production giant to midstream leaders with rich dividends to energy services leaders that offer incredible value now. Obviously, all are rated Buy and have solid upside to their individual price targets.
The Goldman Sachs research team noted this:
Amid heightened geopolitical volatility, investors are looking for stocks with compelling valuations based on mid-cycle prices, recognizing that further upside could emerge if commodity prices remain strong. This week in the Pulse, we ask our senior analyst team what they estimate stocks in their coverage are currently discounting in terms of either a mid-cycle commodity price or a normalized return. Teams discuss what they see the market currently pricing in and highlight stocks they view as undervalued in the current market environment.
Why we recommend Goldman Sachs stocks
Goldman Sachs Research ranks among the best for its unmatched breadth—covering over 3,000 securities, 45+ economies, and all major markets—and rigorous, data-driven analysis. The team delivers thousands of proprietary forecasts, models, and unique indicators, backed by top-tier global analysts and innovative thought leadership on macro, industries, and trends, earning consistent recognition as a trusted resource for institutional investors and high-net-worth investors.
ConocoPhillips
The big always gets bigger, and ConocoPhillips (NYSE: COP | COP Price Prediction) completed a $22.5 billion purchase of Marathon Oil this time last year. This deal added high-quality assets, particularly in the Eagle Ford and Bakken shales, to the company’s portfolio. This exploration and production company offers a solid dividend yield of 2.39%.
Goldman Sachs said this in the research report:
We estimate that ConocoPhillips, on the US Conviction List, is currently discounting a mid-cycle Brent price of around $73/b in 2027-2028. On this basis, it stands out as an undervalued name in our Integrated Oils coverage. We find the company poised to achieve a 20-25% free cash flow per share CAGR through 2030, with growth underpinned by four major projects.
Its Alaska segment primarily explores for, produces, transports, and markets crude oil, natural gas, and natural gas liquids (NGLs). The Lower 48 segment comprises operations in the 48 contiguous states of the United States and the Gulf of America. In contrast, Canadian operations consist of the Surmont oil sands development in Alberta, the liquids-rich Montney unconventional play in British Columbia, and commercial operations.
The Europe, Middle East, and North Africa segment consists of operations principally located in:
- The Norwegian sector of the North Sea
- The Norwegian Sea
- Qatar
- Libya
- Equatorial Guinea
- Commercial and terminalling operations in the United Kingdom
The Asia Pacific segment has exploration and production operations in China, Malaysia, and Australia, as well as commercial operations in China, Singapore, and Japan. The Other International segment includes interests in Colombia as well as contingencies associated with prior operations in other countries.
The Goldman Sachs target price is $144.
Halliburton
This is one of the leaders in the energy services sector, paying a 1.75% dividend and offering solid upside from current levels. Halliburton (NYSE: HAL) is a provider of products and services to the energy industry and operates through two segments: Completion and Production, and Drilling and Evaluation.
The Goldman Sachs analysts noted this:
We continue to highlight Halliburton for balanced exposure across international and North America activity markets, as well as additional value through the company’s partnership and equity stake in VoltaGrid, which offers exposure to the Behind-the-Meter theme.
The Completion and Production delivers cementing, stimulation, specialty chemicals, intervention, pressure control, artificial lift, and completion products and services. The segment consists of:
- Artificial Lift
- Cementing
- Completion Tools
- Pipeline and Process Services
- Production Enhancement
- Production Solutions
The Drilling and Evaluation segment provides field and reservoir modeling, drilling, fluids, evaluation, and precise wellbore placement solutions that enable customers to model, measure, drill, and optimize their construction activities. Its product service lines include:
- Baroid
- Drill bits and services
- Halliburton project management
- Landmark software and services
- Sperry drilling
- Testing
- Subsea
- Wireline
- Perforating
Goldman Sachs has a $44 target price for the shares.
Kinetik
While well off the radar of many investors, this midstream leader has huge total return potential and pays a solid 6.48% dividend. Kinetik (NYSE: KNTK) is an integrated Permian-to-Gulf Coast midstream company operating in the Delaware Basin. It offers comprehensive gathering, transportation, compression, processing, and treating services for companies that produce natural gas, natural gas liquids, crude oil, and water.
Goldman Sachs said this about the company:
The balance of our coverage, which is more oil/liquids-focused, is also trading above mid-cycle: ~10.1x 2027, or ~0.5-1.0x above what we would consider typical. We believe this reflects increasing investor expectations that midstream companies can capture higher marketing gains from commodity price volatility (similar to 2022-23) in the near-term, and that elevated commodity prices could drive higher US production and thus higher midstream throughout growth over the medium- to long-term.
Its segments include Midstream Logistics and Pipeline Transportation.
The Midstream Logistics segment provides gas gathering and processing services with over 3,900 miles of low and high-pressure steel pipeline located throughout the Delaware Basin, including over 2,300 miles of gas pipeline. It operates under three streams:
- Gas gathering and processing
- Crude oil gathering, stabilization, and storage services
- Produced water gathering and disposal
The Pipeline Transportation segment consists of equity investment interests in three Permian Basin pipelines that access various points along the United States Gulf Coast, Kinetik NGL Pipeline, and Delaware Link Pipeline.
The Goldman Sachs target price is $49.
Ovintiv
While likely off the radar for many, this is another solid value energy idea with a 1.93% dividend. Ovintiv (NYSE: OVV) is an oil and natural gas exploration and production company focused on developing its multi-basin portfolio of assets in the United States and Canada.
Goldman Sachs analysts noted this:
We reiterate our Buy rating on OVV with an increased price target and view OVV as an incrementally attractive oily E&P equity given the uplift from higher commodity prices, which should drive excess FCF generation versus prior expectations, allowing OVV to continue reducing the company’s net debt while supporting share repurchases that could further close the valuation dislocation of the stock relative to oily E&P peers.
Its operations include the marketing of oil, natural gas, and NGLs. Its USA Operations segment includes the exploration for, development of, and production and marketing of oil, NGLs, natural gas, and other related activities within the United States. The Canadian Operations segment includes the same activities within Canada.
The company has assets in:
- Anadarko Basin, a liquids-rich play located in west-central Oklahoma, spanning Blaine, Canadian, Custer, Dewey, Garvin, Grady, Kingfisher, McClain, and Stephens counties.
- Montney Basin, a condensate and natural gas play located in northwest Alberta and northeast British Columbia.
- Permian Basin, the largest, most prolific oil-and-gas-producing region in the United States, is located in West Texas and southeastern New Mexico.
The Goldman Sachs target price is $66.
SLB
Formerly known as Schlumberger, SLB (NYSE: SLB) is another industry giant that pays a 2.18% dividend. The analysts said this about the company in the report:
We anticipate SLB to experience the highest rate of change after the end of the supply disruption, as the company is one of the most exposed to the region.
The global technology company that operates in four segments:
- Digital & Integration combines its digital solutions and data products with its integrated Asset Performance Solutions (APS) offering.
- Reservoir Performance comprises reservoir-centric technologies and services that optimize reservoir productivity and performance.
- Well Construction combines the full portfolio of products and services to optimize well placement and performance, maximize drilling efficiency, and improve wellbore assurance. The segment provides services and products to operators and drilling rig manufacturers for well design and construction.
- Production Systems develops technologies and provides knowledge that enhances production and recovery from subsurface reservoirs to the surface, into pipelines, and to refineries.
Goldman Sachs’ $60 target price is almost 12% above current levels.