Hey Investors,

Before I dive into this month’s stock picks, I wanted to give you an important heads-up:

This will be the last dedicated stock pick edition of this newsletter.

Over the past year, my personal investing focus has evolved. I’m now spending the majority of my time buying private businesses and building a portfolio of simple, cash-flowing companies — my own version of a Mini Berkshire Hathaway.

Public markets will always be part of my thinking, and I’ll continue to share investing insights from time to time in my weekly newsletter — whether that’s public companies, industries I’m researching, private deals, or mental models for building long-term wealth.

But going forward, I want to make sure this newsletter reflects where I’m really headed — and where I can deliver the most value to you.

As part of this shift, I’m also building a private list of accredited investors who may want to co-invest with me on select private business deals in the future.

If that’s of interest, you can request to join my private investor list here.

No spam. No obligation. Just first looks when great deals cross my desk.

If you’ve enjoyed the stock picks — thank you. I hope you’ll stick around as I take this next step.

If not, no hard feelings — you can unsubscribe anytime at the bottom of this email.

Now — on to this month’s picks…

Dakota Crisp, PhD

Energy Transfer (ET) has seen its stock trade in a relatively tight range over the past year. Despite strong earnings and consistent distribution increases, investor sentiment toward the midstream energy sector remains muted — partly due to macro fears about recession risk and partly because many investors still favor growth stocks over yield plays. Recent softness in natural gas prices has also weighed on the sector. Yet, ET continues to quietly generate robust cash flow.

ET is a cash-flow machine with one of the most extensive pipeline networks in the U.S., covering natural gas, NGLs, crude oil, and refined products. Its assets are nearly impossible to replicate (a moat of steel and regulatory barriers). The company has focused in recent years on paying down debt and raising its distribution — now yielding over 7%. Free cash flow after distributions remains healthy, giving room for continued deleveraging and future growth. Energy demand — especially for LNG exports and NGLs — provides long-term tailwinds.

ET offers an attractive asymmetric opportunity: limited downside due to long-term contracts and essential infrastructure, but upside from yield compression (if rates fall), further debt reduction, and rising global energy demand. In a market starved for reliable income, an 7% yield from irreplaceable assets looks awfully good. While many chase shiny growth stocks, patient capital can lock in cash flows here.

Diamondback Energy’s stock has had a solid run since 2021, driven by steady oil prices and an improving cost structure. Shares dipped earlier this year on broader energy sector worries and mixed macro signals around global demand — but those concerns were short-term noise. The company’s fundamentals remain robust, especially after its announced acquisition of Endeavor Energy, which will create a Permian Basin powerhouse.

Diamondback is one of the most disciplined operators in U.S. shale, with low breakeven costs, strong free cash flow, and a shareholder-friendly capital return program (dividends + buybacks). The Endeavor deal significantly expands its high-quality acreage and adds operational synergies that should drive even greater cash generation. Long-term, U.S. oil will continue to play a critical role in global supply, and Diamondback is exceptionally well-positioned among peers. It has a durable moat in operational efficiency and scale within the Permian — the lowest-cost major basin in the U.S.

With a clear path to increased scale, exceptional cash flow, and continued shareholder returns, FANG is a compelling buy for long-term investors — particularly on any pullback below $180. The market is still underestimating the full earnings power post-Endeavor integration. Sometimes boring makes you rich — and Diamondback is an oil cash machine.

OXY shares have been trading sideways since 2022. The market remains skeptical about global demand trends and wary of potential new supply. Meanwhile, OXY's debt load from its 2019 Anadarko acquisition still casts a shadow in some investors’ minds — despite Warren Buffett’s Berkshire Hathaway steadily buying up shares (now holding ~29% of the company). Many traders have simply rotated out of energy stocks in search of momentum elsewhere.

OXY is a fundamentally stronger company today than the market gives it credit for. Debt has been aggressively paid down, free cash flow is robust at current oil prices, and management is laser-focused on shareholder returns (including buybacks). Buffett’s continued buying is a vote of confidence — he sees a durable moat in OXY’s unique U.S. shale + chemicals portfolio and its emerging leadership in carbon capture (CCUS), which could be a sleeper growth engine in the coming decade. With oil structurally supported by years of underinvestment and geopolitical instability, OXY offers asymmetric upside at an undemanding valuation.

OXY is a classic “boring is beautiful” play in today’s market — an oil and gas producer with improving balance sheet, massive shareholder backing, and overlooked growth catalysts. While others chase the next hot sector, this is a compounding machine hiding in plain sight. It’s not a meme stock — it’s a Buffett stock. And that should tell you something.

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Disclosure: I currently own positions in OXY.

Disclaimer: The stock picks and information provided here are for informational and educational purposes only and should not be considered financial advice. I am not a financial advisor, and all investments involve risk. Please conduct your own research, consult a professional financial advisor, and carefully consider your own financial situation and risk tolerance before making any investment decisions. The performance of past stock picks is not indicative of future results, and you assume full responsibility for any decisions made based on this information.