Buffett Brain · Research note
Score updated 21 Oct 2026 · analysis from 18 May 2026
COP· Energy
ConocoPhillips
ConocoPhillips runs the cleanest balance sheet in U.S. E&P with 11.2% owner-earnings yield, but commodity cycles cap how confident a long-term owner can be.
Buffett fit
Partial fit
Owner
56
Durability
68
Management
76
Price
70
Score updated 21 Oct 2026 · analysis from 18 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Energy stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Hold all of COP for ten years and you're holding a low-cost-position barrel-producing machine that returns capital aggressively when prices cooperate.
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Oil demand will be debated for the next twenty years, that's the central uncertainty.
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COP has bought back 1.39% of shares per year over five years, meaningful capital return alongside dividends.
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of 20.5 sounds elevated for E&P until you weigh the 11.25% owner-earnings yield and 14.5x EV/, which are more flattering.
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- The full reasoning behind all four pillars
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
7- 1Owner-earnings yield of 11.25% is genuinely attractive for E&P quality
- 2Net debt/EBITDA of 0.78x, one of the cleanest balance sheets in E&P
- 35-year average of 15.22% is excellent for a commodity producer
- 4/Net Income of 2.10x shows depreciation overstates reinvestment needs
Concerns
5- 1No , WTI and Brent dictate revenue line directly
- 2 TTM of 6.08% has normalized down from cyclical peak
- 3EPS max decline of 37.9% shows commodity cycle pain
- 4 of 20.46 not cheap for cyclical at mid-cycle
Price history
$146+92.7%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
ConocoPhillips is a pure-play exploration and production company (no refining, no chemicals) producing crude oil, bitumen, natural gas, LNG, and NGLs from a portfolio anchored in U.S. shale (Permian, Eagle Ford, Bakken) plus international assets in Norway, Qatar, and Australia. The 29.2% is the realized barrel price minus lifting costs, and the 18.3% tells you variable-cost discipline is strong. The unit economics rise and fall with WTI and Brent, there is no .
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
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