Goldman Sachs Top Energy Picks Have Big Upside and Pay Solid Dividends
Goldman Sachs Top Energy Picks Have Big Upside and Pay Solid Dividends
Lee JacksonTue, March 24, 2026 at 11:20 AM UTC
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grandriver / Getty Images (grandriver / Getty Images)
Goldman Sachs is the acknowledged leader in the investment landscape on Wall Street and worldwide. The firm's top-notch research department continues to provide institutional and high-net-worth clients with the best ideas across the investment spectrum and is likely to do so for years to come. Founded in 1869, Goldman Sachs is the world's second-largest investment bank by revenue and is ranked 55th on the Fortune 500 list of the largest U.S. corporations by total revenue.
At 24/7 Wall St., we have followed the company's research for 15 years to bring our readers top stock ideas. Given the massive rise in oil prices, we were excited to find four energy stocks that the Goldman Sachs team remains very bullish on for the long term.
Quick Read -
Goldman Sachs remains very positive on four top exploration and production companies.
All four stocks pay dependable dividends, and in some cases, they are rising.
Despite the huge increase in oil prices, the long-term remains bullish for the sector, and adding some exposure now still makes sense.
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The jump in exploration and production energy companies over the last few months, after grinding slowly higher last year, makes some investors nervous about buying shares now at what seem to be sky-high prices, and the Goldman Sachs team addressed that concern in their research report:
After a sharp rally in Energy equities amid geopolitical volatility and the strengthening of the back end, a key question from here is where we can still find attractive total return from a risk/reward perspective. We use $75/$70 per bbl for Brent/WTI and $3.75/MMBtu for Henry Hub as our 2027-2030 normalized price averages. In our E&P coverage, we highlight our Buy ratings on Oventive, Permian Resources, Diamondback Energy, and Viper Energy as stocks with attractive upside, with an average total return of 22%.
Why we recommend Goldman Sachs energy stocks
Goldman Sachs Research ranks among the best for its unmatched breadth—covering over 3,000 securities, 45+ economies, and all major markets—and rigorous, data-driven analysis. The team delivers thousands of proprietary forecasts, models, and unique indicators, backed by top-tier global analysts and innovative thought leadership on macro, industries, and trends, earning consistent recognition as a trusted resource for institutional investors.
Diamondback Energy
This is one of the best pure-play Permian Basin exploration and production companies, paying a solid 2.16% dividend. Diamondback Energy (NASDAQ: FANG) is an independent oil and natural gas company, focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves primarily in the Permian Basin in West Texas.
The Goldman Sachs team said this regarding the company:
We continue to see FANG trading at an attractive 12% average FCF yield on 2027/2028 estimates versus a large-cap oily E&P peer average of 10% (peers include OXY, EOG, DVN). We believe that FANG is well-positioned to capture upside in periods of strong commodity prices, given the company's low cost structure and low capital intensity relative to peers. In addition, FANG has continued to reiterate the flexibility embedded within the company's Permian operations and continued progress in further taking costs out of the business.
The company's activities are primarily focused on the horizontal development of the Wolfcamp and Spraberry formations in the Midland Basin, and the Wolfcamp and Bone Spring formations in the Delaware Basin, within the Permian Basin.
Its subsidiary, Viper Energy, is focused on owning and acquiring mineral and royalty interests in oil and natural gas properties, primarily in the Permian Basin, and derives royalty and lease-bonus income from such interests.
Diamondback Energy has approximately 859,203 net acres, which primarily consists of 742,522 net acres in the Midland Basin and 116,681 net acres in the Delaware Basin.
The company's subsidiaries include:
Diamondback E&P
Rattler Midstream GP
Rattler Midstream
QEP Resources
The Goldman Sachs target price for the shares is $212.
Ovintiv
While likely off the radar for many, this is another solid value energy idea with a 2.11% dividend. Ovintiv Inc. (NYSE: OVV) is an oil and natural gas exploration and production company that is focused on developing its multi-basin portfolio of assets located in the United States and Canada.
Goldman Sachs analysts noted this:
We reiterate our Buy rating on OVV with an increased price target and view OVV as an incrementally attractive oily E&P equity given the uplift from higher commodity prices, which should drive excess FCF generation versus prior expectations, allowing OVV to continue reducing the company's net debt while supporting share repurchases that could further close the valuation dislocation of the stock relative to oily E&P peers
Its operations include the marketing of oil, natural gas liquids (NGLs), and natural gas. Its segments include USA operations and Canadian Operations.
USA Operations include the exploration for, development of, and production and marketing of oil, NGLs, natural gas, and other related activities within the United States.
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The Canadian Operations include the exploration for, development of, and production and marketing of oil, NGLs, natural gas, and other related activities within Canada.
The company has assets in:
Anadarko Basin
Montney Basin
Permian Basin
Anadarko is a liquids-rich play located in west-central Oklahoma, spanning Blaine, Canadian, Custer, Dewey, Garvin, Grady, Kingfisher, McClain, and Stephens counties. Montney is a condensate and natural gas play located in northwest Alberta and northeast British Columbia.
The Goldman Sachs target price is $66
Permian Resources
Trading at a reasonable 12.7 times forward earnings, with a 3.06% dividend, making it an outstanding total return idea, Permian Resources (NYSE: PR) is an independent oil and natural gas company focused on acquiring, optimizing, and developing oil and natural gas properties.
Goldman Sachs noted this in its discussion of the company:
We reiterate our Buy rating on PR, with an increased price target, and still see double-digit upside to shares at current levels. We hold a positive view towards management's focus on driving sustainable FCF per share growth while sufficiently reinvesting back into the business. PR has a strong track record of operational execution in the Delaware Basin, and we maintain our confidence in the company's ability to continue driving further cost efficiencies across the business.
The company's assets and operations are concentrated in the core of the Delaware Basin.
Permian Resources' position comprises over 479,500 net leasehold acres and approximately 94,900 net royalty acres across the Permian Basin. Most of its assets are concentrated in the Delaware Basin, in Eddy and Lea Counties, New Mexico, and Reeves and Ward Counties, Texas.
The Goldman Sachs price target objective is $23.
Viper Energy
Viper Energy (NASDAQ: VNOM) owns and acquires mineral and royalty interests in oil and natural gas properties in the Permian Basin. With a 4.76% dividend yield, this mid-cap energy play offers significant upside relative to the Goldman Sachs target price. Viper Energy is an independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves, primarily in the Permian Basin in West Texas.
The analysts noted this in the report:
We believe that FANG is well-positioned to capture upside in periods of strong commodity prices given the company's low cost structure and low capital intensity relative to peers. In addition, FANG has continued to reiterate the flexibility embedded within the company's Permian operations and continued progress in further taking costs out of the business.
The company primarily focuses on oil and natural gas properties in the Permian Basin, which covers approximately 75,000 square miles centered on Midland, Texas.
The Viper Energy assets consist of mineral and royalty interests underlying 1,197,638 gross and 34,217 net royalty acres, primarily in the Permian Basin.
It's estimated that proved oil and natural gas reserves totaled 179,249 thousand barrels of crude oil equivalent (MBOE). The company's proven undeveloped reserves include approximately 529 gross horizontal well locations. Its proved reserves include approximately 50% oil, 25% natural gas liquids, and 25% natural gas.
The $61 Goldman Sachs price target represents a stunning 29% gain from current levels.
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