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2 Top Stocks Seeing Major Institutional Buying Right Now

Oil pump with solar panels, industrial equipment

Key Points

  • 13-F filings are an important source of information for retail investors to consider in their research, and the latest ones show great opportunity. 
  • Two stocks stand out for investors to consider and investigate further for potential gains in the coming quarters, backed by one major tailwind.
  • Wall Street analysts see double-digit upside in both, based on EPS growth forecasts and price targets for the coming months.
  • 5 stocks we like better than First Solar.

There are several ways to examine the market and research new ideas that retail investors might suffer from analysis paralysis and avoid taking any views or exposure to what could have been a winning idea. To avoid falling into this behavioral tendency, one way to reverse engineer a potentially winning position is to watch out for 13-F filings.

These are mandatory and regulatory filings that hedge funds and other investment entities must make every quarter. The objective is to inform the public about their current holdings and the stocks they bought or sold during the quarter. This is one data point that retail investors can use to find and dig deeper into potentially winning stocks.

As of the latest 13-F filings of the quarter, a few stocks stand out as buys from institutions and carry enough fundamental reasoning and tailwinds to make them potential research targets for retail investors today. Interestingly enough, these two have to deal with the energy sector and are riding on the upcoming wave of oil demand sparked by interest rate cuts from the Federal Reserve (the Fed); these stocks are Occidental Petroleum Co. NYSE: OXY and First Solar Inc. NASDAQ: FSLR as a renewable energy play.

Why Occidental Petroleum Stock Is a Top Buy in the Oil Industry

Occidental Petroleum Today

Occidental Petroleum Co. stock logo
OXYOXY 90-day performance
Occidental Petroleum
$50.41
-0.15 (-0.30%)
(As of 11/5/2024 ET)
52-Week Range
$49.51
$71.18
Dividend Yield
1.75%
P/E Ratio
12.42
Price Target
$65.72

First, investors need to know who is interested in being exposed to Occidental Petroleum stock so that a sense of authority and quality can be established as a foundation for further research justification. Warren Buffett decided to buy this oil name, but this was no ordinary buy for the Oracle of Omaha.

During the same quarter, Buffett dumped 50% of his holdings in Apple Inc. NASDAQ: AAPL and a significant reduction in the financial sector in shares of Bank of America Co. NYSE: BAC. With this new liquidity, he chose to go into the energy space, buying up to 29% of the entire stock of Occidental Petroleum.

So, Buffett finds not only the size of the position unusual but also the rotation itself. His view is the underperformance of consumer discretionary items like Apple products and the underperformance of the financial sector, where Bank of America could be a victim. More than that, in these environments, oil prices tend to do well simultaneously.

Far from only focusing on Buffett’s buy in Occidental Petroleum, investors can extrapolate the views behind this decision and adjust their portfolios according to these two shifting preferences in the cycles affected by bullish oil. Nonetheless, investors would also benefit from sticking to a deeper dive into Occidental Petroleum stock, particularly since it is lower than where Buffett bought it.

Occidental Petroleum now trades at only 72% of its 52-week high price, giving investors enough of a gap to narrow in the coming quarters. Wall Street analysts think the stock should be trading closer to the consensus price target of $66.3 a share, calling for a net upside of 21.3% from where it trades today.

Occidental Petroleum MarketRank™ Stock Analysis

Overall MarketRank™
97th Percentile
Analyst Rating
Hold
Upside/Downside
30.4% Upside
Short Interest Level
Healthy
Dividend Strength
Moderate
Environmental Score
-8.07
News Sentiment
0.25mentions of Occidental Petroleum in the last 14 days
Insider Trading
Selling Shares
Proj. Earnings Growth
14.59%
See Full Analysis

However, there are those willing to place their bullish views to the test, as analysts from Mizuho Financial landed on a new price target of as high as $72 a share. To prove these outlier views correct, the stock would need to rally by a much higher upside of 32% from where the stock sits today.

According to analysts at Goldman Sachs, the price of oil could rise in the coming months due to business demand and, geopolitical issues and shocks stemming from today’s conflicts across the Middle East. While that’s good for Occidental, it’s also good for other stock institutions that have been buying.

How Rising Oil Prices Could Drive Increased Solar Demand and Boost First Solar Stock

First Solar Today

First Solar, Inc. stock logo
FSLRFSLR 90-day performance
First Solar
$215.89
+3.61 (+1.70%)
(As of 11/5/2024 ET)
52-Week Range
$129.21
$306.77
P/E Ratio
18.60
Price Target
$281.13

When oil prices go up, the cost of most energy sources tends to follow. From gas prices at the pump to electricity, natural gas also increases as a derivative and is correlated with oil. In these environments, alternative energy sources become more attractive for users and investors alike.

This is where First Solar stock comes into play. It offers solar energy as one of the most accessible and developed alternative energy sources available in the market today. According to the 13-F filings for the past quarter, up to $747.9 million worth of buying has come from institutional investors.

Knowing that all of the current tailwinds surrounding the stock are there and institutional buying interest is trickling in now, analysts at Bank of America decided to boost the stock’s price target as recently as October 2024. This time, the price targets have been set at $321 a share, calling for up to 56.5% upside from where the stock trades today.

First Solar MarketRank™ Stock Analysis

Overall MarketRank™
100th Percentile
Analyst Rating
Moderate Buy
Upside/Downside
30.2% Upside
Short Interest Level
Healthy
Dividend Strength
N/A
Environmental Score
-0.14
News Sentiment
0.04mentions of First Solar in the last 14 days
Insider Trading
Selling Shares
Proj. Earnings Growth
56.63%
See Full Analysis

Like Occidental Petroleum stock, First Solar stock trades at a discount to its highs, this time at 83% of its 52-week high, to offer investors a reasonable gap for upside. To crystalize the potential upside in this stock, investors can consider the earnings per share (EPS) growth forecasts set by Wall Street today.

Expecting $4.08 in EPS over the next 12 months would call for a jump of as much as 25.5% from today’s $3.25 EPS level, justifying the upside potential today for First Solar stock.

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Should you invest $1,000 in First Solar right now?

Before you consider First Solar, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and First Solar wasn't on the list.

While First Solar currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

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Gabriel Osorio-Mazilli
About The Author

Gabriel Osorio-Mazilli

Contributing Author

Value Stocks, Asian Markets, Macro Economics

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Occidental Petroleum (OXY)
4.8621 of 5 stars
$50.41-0.3%1.75%12.42Hold$65.72
First Solar (FSLR)
4.985 of 5 stars
$215.89+1.7%N/A18.60Moderate Buy$281.13
Apple (AAPL)
4.7007 of 5 stars
$223.45+0.6%0.45%36.75Moderate Buy$235.51
Bank of America (BAC)
4.8328 of 5 stars
$41.89+1.4%2.48%15.23Moderate Buy$42.97
First Solar (FSLR)
4.985 of 5 stars
$215.89+1.7%N/A18.60Moderate Buy$281.13
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