Mizuho Names Devon Energy, Permian Resources, EQT as Top Oil and Gas Picks

Mizuho has identified Devon Energy, Permian Resources, and EQT Corp. as its top stock picks in the oil and gas sector, citing successful M&A integration, operational efficiency gains, and strategic market access as key drivers for the selections.

Devon Energy Leads on Merger Synergies

Mizuho named Devon Energy (NYSE:DVN) its leading choice, emphasizing the company's progress in integrating its recent merger with CrownRock. The firm noted that Devon is conducting a full portfolio review to optimize capital allocation across its newly expanded asset base, which includes approximately 400 new premium locations in the Delaware Basin.

Key operational and financial highlights supporting Mizuho's view include:

• Synergy initiatives are on track to exceed the $1 billion gross target.
• Early surfactant testing shows a production uplift of more than 15% after 180 days.
• The company has already met its 2026 debt reduction target and is actively using its $8 billion share repurchase program.

Devon's strong financial position was further underscored by its second-quarter 2026 results, where it surpassed analyst expectations and increased its quarterly dividend by 33% to $0.32 per share.

Permian Resources, EQT Round Out Selections

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Permian Resources (NYSE:PR) ranked second on Mizuho's list, recognized for strong operational execution and strategic corporate moves. The company recently increased its 2026 volume guidance by approximately 3% and has reduced its well costs to roughly $685 per foot. Permian also converted to a traditional C-Corp structure, eliminating all remaining private equity sponsor ownership, and reported a record $751 million in free cash flow for the second quarter.

Natural gas producer EQT Corp. (NYSE:EQT) secured the third spot, praised for its efforts to secure long-term market access and improve its financial standing. Mizuho highlighted a new five-year LNG offtake agreement expected to contribute approximately $45 million in annual free cash flow beginning in 2028. This move, coupled with significant debt reduction, prompted S&P Global Ratings to revise its outlook on the company to positive from stable.

What This Means for the Sector

Mizuho's top selections reflect several key themes currently shaping the U.S. oil and gas industry. The focus on Devon's merger highlights the ongoing trend of consolidation, where extracting synergies and optimizing combined asset portfolios are critical for shareholder returns.

Permian Resources' success underscores the market's reward for consistent operational efficiency and cost control, particularly in mature basins. Meanwhile, EQT's LNG and power-linked deals illustrate a strategic push by natural gas producers to diversify their revenue streams and mitigate exposure to volatile domestic spot pricing.