In one of the more anti-woke stock recommendations of the week, analysts at JPMorgan have tipped Big Oil stocks, particularly British supermajor Shell PLC (LSE:SHEL, NYSE:SHEL).
"Fundamentally, we believe oil and gas is significantly underrated and undervalued in the context of the need for a reality check on Energy Transition," they said.
Big Oil firms have been in a green retreat in recent months, particularly BP, which made it quite clear that shareholder returns trump net-zero targets for now.
But Shell is JPM’s top pick with an overweight rating on the stock.
“We are bullish energy equities and buyers of dips for oil supercycle tightening from mid-decade and premium (free cash flow) underpinned by well placed ‘committed’ cash breakevens,” said the American investment bank.
It added: "The case to add production currently remains unclear; we don’t rule out OPEC maintaining its current quotas and voluntary adjustments for the next few quarters, but can also see a case for it to gradually add back the barrels given global oil demand remains strong."
Italian energy company Eni also got an overweight rating from JPM.