ConocoPhillips' Stock Is About as Cheap as It's Been Since 2023. Here's 1 Thing to Know Before You Buy.
Despite a strong rebound this month, ConocoPhillips (NYSE: COP) stock remains cheap, according to several valuation metrics. But you need to be looking ahead, not behind, to see it. That's because valuation metrics like the price-to-sales ratio and the price-to-earnings ratio are backward-looking, using figures that have already been achieved.Analysts are reporting that ConocoPhillips has a brighter future than past. And if you monitor the correct ratios, you may conclude that shares are a buy right now.The EV/EBITDA (enterprise value/earnings before interest, taxes, depreciation, and amortization) ratio is a great metric to use to gauge the attractiveness of oil stocks like ConocoPhillips. That's because it adjusts for certain unique aspects of the industry like high capital intensity, debt levels, and earnings cyclicality. It has a greater focus on cash flows, giving you a more consistent understanding of the business versus profits or sales figures.Continue reading
Despite a strong rebound this month, ConocoPhillips (NYSE: COP) stock remains cheap, according to several valuation metrics. But you need to be looking ahead, not behind, to see it. That's because valuation metrics like the price-to-sales ratio and the price-to-earnings ratio are backward-looking, using figures that have already been achieved.
Analysts are reporting that ConocoPhillips has a brighter future than past. And if you monitor the correct ratios, you may conclude that shares are a buy right now.
The EV/EBITDA (enterprise value/earnings before interest, taxes, depreciation, and amortization) ratio is a great metric to use to gauge the attractiveness of oil stocks like ConocoPhillips. That's because it adjusts for certain unique aspects of the industry like high capital intensity, debt levels, and earnings cyclicality. It has a greater focus on cash flows, giving you a more consistent understanding of the business versus profits or sales figures.
