Swiss bank UBS Group (UBS) has named a little-known company as its top pick in the oil sector.
Meet Samuel – Your Personal Investing Prophet
- Start a conversation with TipRanks’ trusted, data-backed investment intelligence
- Ask Samuel about stocks, your portfolio, or the market and get instant, personalized insights in seconds
According to UBS, Ovintiv (OVV) is the best oil stock for investors to buy now as the war in Iran continues and crude oil prices fluctuate wildly. You can be forgiven if you haven’t heard of Ovintiv. The company largely flies under the radar and isn’t a household name like oil companies Chevron (CVX) and Shell (SHEL).
Based in Denver, Colorado, Ovintiv was known as Encana and based in Canada until 2020, when it relocated to the U.S. and underwent a rebrand. Today, Ovintiv is engaged in hydrocarbon exploration, with operations mostly in the Permian Basin of Texas.
Why OVV Stock?
So why is UBS bullish on OVV stock? The Swiss bank says the company has successfully addressed two concerns that previously weighed on its share price and valuation. The company’s acquisition of NVA’s Montney assets, combined with its recently announced Anadarko Basin divestiture, has largely resolved issues related to crude oil and condensate inventory as well as its high debt levels.
UBS’ bullish call comes with UVV stock up 47% this year, riding high on the back of surging crude oil prices. The war in Iran has sent crude oil prices as high as $120 a barrel in recent weeks. Brent crude oil, the international standard, is currently trading at $102 per barrel amid signs of a diplomatic resolution to the Middle East war.
Is OVV Stock a Buy?
Ovintiv stock has a consensus Strong Buy rating among 18 analysts. That rating is based on 14 Buy and four Hold recommendations issued in the last three months. The average OVV price target of $59.12 implies 0.92% downside from current levels.
