Phillips 66
This extremely diversified energy company has a long and successful operating history, and shares have backed up nicely. Phillips 66 (NYSE: PSX) operates through four segments: Midstream, Chemicals, Refining, and Marketing and Specialties. The company holds many of these assets within its MLP, Phillips 66 Partners.
The company benefits from the tax-advantaged structure while still operating a more diversified operating business that also contains many assets that are not ideal MLP assets, such as its fast-growing chemical manufacturing business and its super-profitable refined products marketing business.
Phillips 66 remains a top refining idea across Wall Street, where many continue to see headroom for incremental capital returns. Most analysts are very constructive on a positive rate of change at Refining in 2022 at the company. In addition, they continue to see attractive nonefining value in the other segments.
Investors receive a 4.82% dividend. The Phillips 66 price target at Wells Fargo is $127, well above the $115.39 consensus target. Shares closed at $80.51 on Tuesday.
TotalEnergies
This French integrated giant is another great way to play an energy rally from the European side. TotalEnergies S.E. (NYSE: TTE) operates as an integrated oil and gas company worldwide. Its Exploration & Production segment engages in oil and natural gas exploration and production activities in approximately 50 countries.
The Integrated Gas, Renewables & Power segment engages in the liquefied natural gas (LNG) production, shipping, trading and regasification activities; trading of liquefied petroleum gas (LPG), petcoke and sulfur, natural gas and electricity; transportation of natural gas; electricity production from natural gas, wind, solar, hydroelectric and biogas sources; energy storage activities; and development and operation of biomethane production units, as well as provides energy efficiency services.
The Refining & Chemicals segment refines petrochemicals, including olefins and aromatics; and polymer derivatives, such as polyethylene, polypropylene, polystyrene and hydrocarbon resins, as well as biomass conversion and elastomer processing. This segment also engages in trading and shipping crude oil and petroleum products.
The Marketing & Services segment produces and sells lubricants; supplies and markets petroleum products, including bulk fuel, aviation and marine fuel, special fluids, compressed natural gas, LPG and bitumen; and provides fuel payment solutions. It operates approximately 15,500 service stations.
TotalEnergies stock comes with a 4.87% dividend. BofA Securities has set an $80 price target, while the consensus target is just $64.24. The shares closed on Tuesday at $48.35.
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