The volatile economic situation prevalent globally has not spared the basic materials industry. However, with the help of the TipRanks Expert Center, investors can pick gems from the oil, gas, and minerals sector by following a top analyst. In today’s “Expert Spotlight” piece, we highlight Brigham Minerals (NYSE: MNRL) and Kimbell Royalty Partners (NYSE: KRP), two top picks of John Freeman, a top Raymond James analyst in the basic materials sector.
Freeman has a wealth of knowledge in the equity research domain with over two decades of experience in the field. Freeman is the Managing Director at Raymond James and has been with the company for 22 years. He is an MBA graduate from the University of Notre Dame’s Mendoza College of Business while also being a graduate in Finance and International Business from Baylor University.
Freeman Ranks High in the TipRanks Universe
According to the TipRanks Star Ranking System, John Freeman ranks #5 out of 7,996 analysts in the TipRanks universe and #10 among 21,181 overall experts, including hedge fund managers, Wall Street analysts, corporate insiders, financial bloggers, and individual investors.
Freeman’s success rate in picking stocks stands at 66%, whereas his average return per rating is an impressive 37.30%.
The analyst’s average returns relative to the S&P 500 and the benchmark sector stand at 28% and 27.8%, respectively.
As is evident from the majority of his recommendations, Freeman is a technology sector bull. Among his picks, 77.11% are Buys, 16.55% have a Hold rating, and 6.34% have a Sell rating.
Notably, according to TipRanks, Freeman’s most profitable pick has been Laredo Petroleum (LPI) between October 23, 2020 and October 23, 2021, generating an impressive return of 738.1%.
Now, let’s have a deeper look at his two top picks.
Analyst Remains Bullish on Brigham Minerals, Inc.
Founded in 2012, Brigham Minerals is a mineral acquisition company focused on acquiring oil and gas mineral rights. Currently, the company commands a market cap of $1.61 billion.
Brigham Minerals’ latest results for the first quarter were impressive, with both revenue and earnings recording massive growth. Revenues for the quarter came in at $71.43 million, up 111.5% from the prior year. Earnings per share (EPS) for the quarter stood at $0.62, which denotes a whopping growth of 210% from the year-ago quarter.
Moreover, the company’s dividend yield of 6.78% is much above the sector average of 1.614%.
Notably, the company is slated to report its results for the second quarter on August 4, 2022.
Freeman remains bullish on the stock. The analyst reiterated a Buy rating with a price target of $41, which implies upside potential of 54.4% from current levels.
Meanwhile, the analyst enjoys a success rate of 92% and an average profit of 47.73% on the stock.
Overall, consensus among analysts for Brigham Minerals stock is a Strong Buy based on five Buys and one Hold. The MNRL average price target of $35.83 implies upside potential of 35% from current levels. Shares have gained 51.7% over the past year.
Freeman Still Optimistic about Kimbell Royalty Partners, LP
Kimbell Royalty Partners is an oil and gas company with massive land holdings and mineral rights. Since it has huge land holdings, the company generates extensive income from royalties. Presently, the company commands a market cap of $1.17 billion.
The company’s latest results for the first quarter were stellar. Revenues for the quarter stood at $33.75 million, up 50.6% from the prior year. EPS for the quarter came in at $0.13, which compares favorably to a loss of $0.02 in the year-ago quarter.
Further, the company’s impressive dividend yield of 8.53% is much above the sector average of 1.614%.
Notably, the company is expected to report its results for the second quarter on August 4, 2022.
Freeman remains bullish on the stock. He reiterated his Buy rating with a price target of $26, which implies upside potential of 45.9% from current levels.
Meanwhile, the analyst enjoys a success rate of 72% and an average profit of 30.26% on the stock.
Overall, consensus among analysts for the Kimbell Royalty stock is a Strong Buy based on four unanimous Buys. The KRP average price target of $23.75 implies upside potential of 33.3% from current levels. Shares have gained 70.04% over the past year.
Oil and Gas Co.s Can Rise Above Volatility
With the global economic scenario expected to remain volatile, companies in the oil and gas field are likely to continue to benefit. To that end, these two picks from an experienced analyst like John Freeman’s arsenal can be taken into consideration by investors as viable investment choices.
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