Energy Stocks Surge: ConocoPhillips and Kinder Morgan as Top Picks for 2026
Written by Emily J. Thompson, Senior Investment Analyst
Source: Fool
- Energy Sector Performance: The energy sector has surged 12.9% year-to-date, establishing itself as the best-performing stock market sector in 2026, surpassing materials, which indicates strong investor interest in high-yield energy stocks.
- ConocoPhillips Dividend Growth: As the largest U.S. exploration and production company, ConocoPhillips aims to lower its free cash flow breakeven to below $30 per barrel, with a 3.3% dividend yield, positioning itself to consistently increase dividends and attract long-term investors.
- Kinder Morgan Growth Potential: Kinder Morgan anticipates a 5% increase in adjusted net income for 2026 compared to 2025, with 70% of its budgeted cash flows being take-or-pay or hedged, ensuring high accuracy in earnings forecasts and highlighting its critical role in the LNG industry.
- Infrastructure Investment Recovery: Since 2022, Kinder Morgan's capital expenditures have been on the rise, reflecting a renewed willingness to invest in long-term projects, which is expected to support higher free cash flow and larger dividend payouts, further solidifying its position as a high-yield stock.
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Analyst Views on COP
Wall Street analysts forecast COP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for COP is 113.39 USD with a low forecast of 98.00 USD and a high forecast of 132.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
18 Analyst Rating
15 Buy
3 Hold
0 Sell
Strong Buy
Current: 104.230
Low
98.00
Averages
113.39
High
132.00
Current: 104.230
Low
98.00
Averages
113.39
High
132.00
About COP
ConocoPhillips is an exploration and production company. Its Alaska segment primarily explores for, produces, transports and markets crude oil, natural gas and NGLs. The Lower 48 segment consists of operations located in the 48 contiguous states in the United States and the Gulf of Mexico. 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 and commercial and terminalling operations in the United Kingdom. Asia Pacific segment has exploration and production operations in China, Malaysia, Australia and commercial operations in China, Singapore and Japan. Other International segment includes interests in Colombia as well as contingencies associated with prior operations in other countries.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
ConocoPhillips Stock Pulls Back, Outlook Remains Positive
- Stock Pullback: ConocoPhillips (COP) shares fell 2.3% to $101.80 on Monday, breaking a six-session winning streak, despite a 6% gain over that period, indicating potential short-term volatility risks.
- Long-Term Holding Rating: J.P. Morgan downgraded COP in January but still considers it a long-term core holding, reflecting the company's strong asset portfolio and durable inventory, suggesting attractiveness in its future cash return framework.
- Analyst Optimism: Seeking Alpha's Quant Rating gives COP a Hold rating of 3.3, with an A+ for profitability prospects and a D for growth factors, indicating strong earnings potential but limited growth, with analysts generally viewing the stock as a Buy.
- Market Confidence: Among 22 Wall Street analysts, 16 have rated the stock as Buy or higher, demonstrating confidence in ConocoPhillips' future free cash flow growth and operational strength, with expectations for enhanced returns through 2026 and beyond.
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Energy Stocks Surge: ConocoPhillips and Kinder Morgan as Top Picks for 2026
- Energy Sector Performance: The energy sector has surged 12.9% year-to-date, establishing itself as the best-performing stock market sector in 2026, surpassing materials, which indicates strong investor interest in high-yield energy stocks.
- ConocoPhillips Dividend Growth: As the largest U.S. exploration and production company, ConocoPhillips aims to lower its free cash flow breakeven to below $30 per barrel, with a 3.3% dividend yield, positioning itself to consistently increase dividends and attract long-term investors.
- Kinder Morgan Growth Potential: Kinder Morgan anticipates a 5% increase in adjusted net income for 2026 compared to 2025, with 70% of its budgeted cash flows being take-or-pay or hedged, ensuring high accuracy in earnings forecasts and highlighting its critical role in the LNG industry.
- Infrastructure Investment Recovery: Since 2022, Kinder Morgan's capital expenditures have been on the rise, reflecting a renewed willingness to invest in long-term projects, which is expected to support higher free cash flow and larger dividend payouts, further solidifying its position as a high-yield stock.
Continue Reading