Replies to post #341 on ConocoPhillips (COP)

[Timothy Smith]

Shareholders who have been long Conoco since the 2012 spinoff and before have benefited the most. Conoco shares are no doubt up a lot recently.

But I don't think it's over. Conoco's 4.13% dividend still leads its peers by a good bit. Conoco is a buy until the yield hits 3.6% or thereabouts.

Even then the dividend would be higher than Exxon (XOM) or Chevron (CVX), but we probably need some yield premium to compensate for lower return on equity and capital versus those other two.

[Timothy Smith]

After lagging the markets for much of 2013, ConocoPhillips' stock has now shown a couple strong months of performance. Since late April, ConocoPhillips is up about 15% compared to the S&P 500, which has gained only 4% and the Dow Jones, which is up 1%.

Operationally, ConocoPhillips has been performing well, with its North American assets meeting or exceeding production targets. Q3 2013 should mark the last quarter of Y/Y production declines, with Q4 2013 expected to benefit extensively from ConocoPhillips' increased capital spending.

Considering the recent increase in oil prices, its solid 4.20% yield, and expected production growth, ConocoPhillips seems to be set up for a strong second half of the year.

Even with the current run-up in its stock price, ConocoPhillips is still not an expensive stock.