S&P 500 ^GSPC
4,981.84
+0.13%
Nvidia NVDA
$674.72
-2.85%
Alphabet GOOG
$143.84
+1.15%
Amazon AMZN
$168.59
+0.90%
Meta META
$468.03
-0.68%
Tesla TSLA
$194.77
+0.52%
Apple AAPL
$182.32
+0.42%
Microsoft MSFT
$402.18
-0.15%

Lesser-known dividend oil companies that can provide you with fat passive income

Mart Poom
22. 5. 2023
4 min read

Exxon and Chevron are undoubtedly quality companies. But everyone knows them. And that's just it - they may well not be hiding the opportunity that many other, smaller companies are. And we'll look at 4 of them here.

Phillips 66 $PSX+0.0%

Phillips 66 is an American energy company that refines crude oil, retails gasoline under the Phillips 66, 76 and Conoco brands. It owns 7,300 gas stations, four refineries, is involved in crude oil processing and transportation, and produces chemicals.

It has revenues of $175 billion and net income of $5 billion. Shares have risen 33% since 2020, especially in 2021. The company plans to grow through acquisitions in the refining and transportation of crude oil.

PSX
$143.58 $2.44 +1.73%
1 Day
+1.73%
5 Days
+1.89%
1 Month
+6.18%
6 Months
+16.25%
1 Year
+37.08%
YTD
+17.12%
5 Years
+3.53%
Max.
+248.03%

Capital Structure

Market Cap
62.10B
Enterpr. Val.
78.02B
Revenue
149.41B
Shares Out.
439.96M
Debt/Capital
0.39
FCF Yield
11.42%

Valuation / Dividends

P/E
9.12
EPS
15.47
P/S
0.42
P/B
2.04
Div. Yield
2.97%
Div. Payout
24.62%

Capital Eff. / Margins

ROIC
13.04%
ROE
25.37%
ROA
9.82%
Gross
12.09%
Operating
5.65%
Net Profit
5.11%
0
1
2
3
4
5
6
7
8
9

Phillips 66 counts airlines, automotive, petrochemical, and construction among its customers. Analysts are recommending the stock in part because of the high dividend of over 4%.

PSX's Frac-4 technology came online in the fourth quarter of last year, and the price of natural gas - the primary feedstock for PSX's refining and chemical operations - has been falling.

Hess $HES+0.0%

Hess Corporation is a U.S. energy company focused on oil and natural gas production, petroleum refining, and the sale of chemicals and other petrochemicals.

Principal activities include exploration and production of oil and natural gas worldwide, operation of refineries in the Caribbean, production and sale of chemicals and plastics, and generation of renewable electricity.

The renewables sector is truly huge. It is therefore good that this is where the company is involved. Source

Hess operates a refinery in Port of Sweeny, Texas, and owns producing fields in several countries, including the US, Guyana and Malaysia. These are mainly natural gas fields. In 2021, revenues were $26 billion and net income was $1.3 billion. Currently, it is 11 billion.

Unfortunately, the company pays a relatively low quarterly dividend of about 0.1 cents per share, which yields 1.1%.

The looming recession and unfavorable outlook for oil and gas prices are limiting the growth outlook for this company and leaving their mark on the company's results.

Hess is led by a shareholder-friendly management team that intends to return up to three-quarters of its free cash flow back to investors in the form of dividend increases and share repurchases over the long term. The company's free cash flow growth outlook is bright and is supported by its attractive position in the emerging oil industry in Guyana along with its significant position in the Bakken shale play in North Dakota.

HES
$148.45 $1.77 +1.21%
1 Day
+1.21%
5 Days
+1.48%
1 Month
+4.69%
6 Months
+16.13%
1 Year
+34.76%
YTD
+18.17%
5 Years
+153.81%
Max.
+1,945.82%

Capital Structure

Market Cap
45.05B
Enterpr. Val.
52.53B
Revenue
10.43B
Shares Out.
307.16M
Debt/Capital
0.52
FCF Yield
0.87%

Valuation / Dividends

P/E
32.74
EPS
4.48
P/S
4.34
P/B
5.24
Div. Yield
1.19%
Div. Payout
32.64%

Capital Eff. / Margins

ROIC
12.23%
ROE
19.30%
ROA
6.87%
Gross
62.73%
Operating
31.48%
Net Profit
15.27%
0
1
2
3
4
5
6
7
8
9

Targa Resources Corp. $TRGP+0.0%

Targa Resources Corp. is a U.S. company engaged in the processing, storage and transportation of crude oil, liquefied natural gas (LPG), carbon dioxide and other liquid amines and hydrocarbons.

LPG Market size is also quite interesting. Source

The company owns and operates oil and gas infrastructure assets, including pipelines, storage terminals, LPG processing and refineries.

In its latest results, the company showed significant year-over-year improvement in almost all financial performance metrics. The company also appears poised to continue this growth trajectory into the future, with a number of new projects due to come on stream by mid-2025.

TRGP
$97.44 $1.08 +1.12%
1 Day
+1.12%
5 Days
-2.57%
1 Month
+3.83%
6 Months
+10.65%
1 Year
+25.01%
YTD
+20.64%
5 Years
+57.89%
Max.
+245.06%

Capital Structure

Market Cap
21.50B
Enterpr. Val.
34.22B
Revenue
16.38B
Shares Out.
223.16M
Debt/Capital
0.84
FCF Yield
2.84%

Valuation / Dividends

P/E
26.33
EPS
3.66
P/S
1.31
P/B
8.57
Div. Yield
2.09%
Div. Payout
29.00%

Capital Eff. / Margins

ROIC
13.81%
ROE
52.48%
ROA
6.76%
Gross
24.15%
Operating
15.52%
Net Profit
8.33%
0
1
2
3
4
5
6
7
8
9

The company also maintains a very strong balance sheet and an attractive coverage ratio. Basically, the only real criticism here is that the dividend is again not very heady. On the other hand, the aforementioned 20% payout ratio is very positive here. Moreover, Targa has great growth potential, which cannot be said of many of its competitors.

Halliburton $HAL

Halliburton is an American energy company that services the oil and gas industry worldwide. It explores for and produces oil and gas, and builds and repairs oil and gas facilities.

HAL
$35.13 $0.00
1 Day
+0%
5 Days
+4.14%
1 Month
+3.59%
6 Months
+8.35%
1 Year
+42.99%
YTD
+8.9%
5 Years
+11.44%
Max.
+938.23%

Capital Structure

Market Cap
31.27B
Enterpr. Val.
37.79B
Revenue
23.02B
Shares Out.
890.10M
Debt/Capital
0.48
FCF Yield
6.65%

Valuation / Dividends

P/E
12.03
EPS
2.92
P/S
1.36
P/B
3.34
Div. Yield
1.82%
Div. Payout
21.83%

Capital Eff. / Margins

ROIC
16.68%
ROE
29.60%
ROA
10.69%
Gross
24.36%
Operating
17.74%
Net Profit
11.46%
0
1
2
3
4
5
6
7
8
9

The principal activities include oil and gas well drilling, maintenance and repair, engineering plan development, consulting and support, earthwork, pipeline system construction, and capping. It operates in more than 100 countries worldwide. As a result of the challenges, the company has implemented cost-saving measures and expects modest earnings growth in 2022.

Halliburton's management is committed to returning capital to shareholders, with a target of at least 50% free cash flow. In the first quarter earnings call, CEO Jeff Miller indicated that current conditions support returning more capital to shareholders through buybacks.

Halliburton's buybacks. Source

Disclaimer: This is in no way an investment recommendation. This is purely my summary and analysis based on data from the internet and other sources. Investing in the financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.

Read the full article for free?
Go ahead 👇

Log in to Bulios

Log in and follow your favorite stocks, create a portfolio and discuss with others


Don't have an account? Join us

Pass the article on, or save it for later.