The Middle East has been engaged in active warfare for the past eleven days, and all eyes are on the Strait of Hormuz. This narrow waterway connects the oil and gas-rich countries of the Persian Gulf with global shipping routes and is widely considered one of the world’s most important energy hubs. About 20% of the world’s hydrocarbon supplies pass through the strait, meaning any disruption could quickly ripple through global energy markets.
Oil prices reacted immediately as the conflict widened. Brent crude briefly rose to nearly $120 a barrel on Monday – its highest level since the 2022 Russian invasion of Ukraine in months – while the US benchmark WTI rose to the same level. Still, prices reversed sharply later in the day after President Donald Trump suggested the conflict was nearing an end. Following these comments, Brent and WTI fell below $90 per barrel in late trading.
Even after this sharp move, oil prices remain above the $70 per barrel range where they were trading before the US and Israel launched their campaign on February 28.
Against this background, energy analysts at UBS are closely monitoring the situation and its implications for the energy sector. The bank believes that the current setup still supports energy stocks and argues that geopolitical risk may not yet be fully reflected in market prices.
“We increase PTs and continue to have a positive risk/reward for energy… The longer the Middle East conflict drags on, the more we look at the entire curve. We don’t believe stocks and the forward curve reflect this risk, as both have moved <3% prior to Friday, February 20. We also see global natural gas prices rising due to these potential Bastar/Bastar oil supply concerns. Gas companies Potentially more FCF upside,” Tim wrote.
With that in mind, UBS analysts have identified two energy stocks that they believe are particularly well-positioned to benefit if oil prices remain high. Using the TipRanks database, we took a closer look at how these picks stack up against the broad Wall Street consensus. Let’s dive in.
Magnolia Oil & Gas((MGY)
We’ll start in Houston, Texas, where Magnolia Oil & Gas operates as an independent producer in the hydrocarbon field. The company’s footprint is in the southeastern part of the state, particularly in the Giddings and Karns areas; The company’s Karnes holdings are considered a “wanting” position in the core of the Eagle Ford shale formation.
This means that Magnolia operates in some of the richest oil and gas regions in Texas. The company had an average daily production of 103.8 Mboe/d in 4Q25; The numbers indicated that the company’s production accelerated during the year – for the full year 2025, average daily production reached 99.8 Mboe/d. Q4 output was 11% higher than the last quarter of 2024. Production in the Giddings area, where magnolia has the most extensive ownership, represents 79% of the total. Magnolia targets 5% production growth for 2026.
Like most energy producers, Magnolia pays its investors reliable dividends. The company is gradually increasing this payment from 2022; The last announcement, which was made on January 29, was for a payment of $0.165 per common share on March 2. At that price, the dividend is annualized at 66 cents per common share and yields a forward yield of 2.3%.
Turning to finances, in 4Q25, Magnolia reported $317.6 million in the quarter. That was down 2.7% year-over-year, but it beat forecasts of $3.89 million. The bulk of this revenue, more than $215 million, came from oil production. Natural gas and natural gas liquids remain. Magnolia reported 4Q diluted EPS of 37 cents; That was down 16% from the year-ago period, though it came in ahead of estimates by $0.01.
UBS analyst Peyton Dorn cites several reasons why investors should get on board here. Dorn writes, “We raise our MGY PT from $29 to $35, largely reflecting an increase in our 2027E EV/EBITDAX PT multiple from 4.85x to 5.75x. This is a premium to the 5-year average multiple of 5.0x, which we see as warranted by MGY’s high prices at close to MGY’s price. Growth, and MGY’s sustainable capital return. MGY remains our top pick for shareholder returns with underlying volume growth due to returns, balance sheet strength, and high-level capital efficiency.
These comments support the analyst’s Buy rating on the shares, while the $35 price target implies a potential one-year upside of ~20.5%. (Click here to view Dorn’s track record)
The 16 recent analyst reviews for Magnolia split it 9 to 7 in favor of an Overhold Buy, all for a Moderate Buy consensus rating. It is worth noting that the shares have increased by 33 percent so far this year. As such, the average price target of $29.15 suggests that the shares will remain in range for now. With this in mind, look for other price targets to raise or lower the rating in the short term. (See MGY Stock Forecast)
Cord energy((CHRD)
For the next stock on our list, we’ll head north, to the Williston Basin of the Dakotas and Montana. The region contributed to the national lexicon of hydraulic fracturing, and made North Dakota a big name in the US oil industry. Cord Energy is a key player in Williston’s most famous oil-bearing formation, the Beacon Shale. The company’s beacon land holdings are located primarily in the northwest corner of North Dakota and extend west just into Montana.
Cord describes itself as a leading operator in the Williston area, offering both advanced scale and an inventory that is deep and low-cost. Chord boasts that it has a valuable mix of high-quality assets and low break-even costs in its reserves, which total approximately 1.3 million net acres. The company has 5 operating rigs and 57% of them are oil reserves.
Like Magnolia above, Cord pays a steady dividend over several years. In its latest announcement, announced in February for payment on March 27, the company set a dividend of $1.30 per common share. At that rate, the annual payout of $5.20 per common share yields a solid forward yield of 4.22%, nearly a full percentage point above the current rate of inflation.
In its most recent quarterly report, covering 4Q25, Chord reported total revenue of $1.17 billion. That number was down 19% from last year, but it beat forecasts of $140 million. The company’s adjusted diluted EPS of $1.28 per share was 4 cents better than estimates.
Cord’s cash flow in the quarter was good. The company reported adjusted free cash flow of $175 million, and said that approximately 50% of that number was returned to shareholders. Returns are made through common stock dividends and the company’s share purchase authority.
In his coverage of Cord for UBS, analyst Josh Silverstein writes, “We see CHRD as one of the biggest beneficiaries of rising crude prices. With increased near-term cash flows, we see that CHRD can gradually accelerate its process to sub-0.5x returns, enabling it to rapidly return from FC to a 0.5% to 0.50% return on investment.” 75%, boosting our forecast for the company’s 2026 buyout.
The 5-star analyst rates CHRD as a buy, and completes with a $142 price target, implying a 15% gain over the next 12 months. (To see Silverstein’s track record, click here)
Turning now to the general street view, where the stock has a moderate buy consensus rating based on 14 reviews that include 9 buys to 5 holds. Shares of CHRD are up 33% year-to-date, and the current trading price of $123.22 and average target price of $127.50 combined suggest a modest gain of just 3.5% for the year. (See CHRD Stock Forecast)
Disclaimer: The views expressed in this article are only those of the particular analyst. The content is used for informational purposes only. It is very important to do your analysis before making any investment.
