UBS Cautious on ConocoPhillips (COP) Amid Increased Willow Project Cost Estimates, Maintains 'Buy' Rating

ConocoPhillips (NYSE:COP) is one of the most undervalued NYSE stocks to buy right now. On November 12, UBS lowered the firm’s price target on ConocoPhillips to $117 from $122 and kept a Buy rating on the shares. Despite the financial challenges faced by the company associated with the Willow CapEx, UBS kept its optimistic forecast unchanged.

Earlier on November 6, Bloomberg reported that ConocoPhillips increased its total spending plan for the Willow oil and natural gas project in Alaska to as much as $9 billion due to inflation and rising costs. The company initially estimated capital spending for the North Slope project at $7 to $7.5 billion. The primary reason for raising the estimate to the new range of $8.5 to $9 billion is general inflationary costs amounting to ~$700 million.

ConocoPhillips still expects to begin oil production from the Willow project in early 2029. The project is important for the company as it diversifies its portfolio while shale basins in Texas mature. The Willow project is expected to produce ~600 million barrels of crude over a 30-year lifespan, which aligns with the push for more domestic oil production.

ConocoPhillips (NYSE:COP) explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas/LNG, and natural gas liquids.

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Disclosure: None. This article is originally published at Insider Monkey.