Despite crude oil prices falling to the low $50 range, ConocoPhillips (NYSE: COP) is still making a good impression on analysts. In fact a key independent research firm sees about a 40% upside from current prices.

Argus reiterated a Buy rating for ConocoPhillips and raised the price target to $82 from $75. The reasoning behind this was that Argus believes that Conoco’s combination of major long-cycle and unconventional short-cycle projects will enable it to generate shareholder value in a range of commodity price environments.

Currently, ConocoPhillips takes the third spot in terms of the largest U.S. oil company by market cap. Separate from that, it is the largest independent pure-play exploration and production (E&P) company in the world. Argus believes that the high-quality, low-cost asset base will aid in ConocoPhillips’ performance relative to its peers when commodity prices are low.

Production from continuing operations in the most recent quarter, excluding Libya, came in at the high end of management’s guidance range, at 1,610 thousand barrels of oil equivalent per day (mboe/d). Production rose 5% year-over-year, after adjusting for planned maintenance work, driven mainly by production from Canadian oil sands, unconventional development in the Lower 48, and the start-up of a new site offshore Malaysia.

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The independent research firm detailed the company’s domestic production:

In ConocoPhillips’ highest-producing geographic segment, the Lower 48, production averaged 542,000 barrels of oil equivalent per day (boe/d), up 7% from last year. The Lower 48 region includes the company’s prolific Eagle Ford and Bakken shale assets, and growth was driven primarily by a 16% increase in crude oil production. At the end of April, the Lower 48 had 15 rigs running, down from 32 at the end of 2014. Management expects production growth to slow in the second quarter and to decline on an absolute basis in the second half due to the reduction in the number of operating rigs.

Argus said:

Our average WTI price forecasts are $55 per barrel for 2015 and $65 per barrel for 2016. For Brent, our average 2015 forecast is $59 per barrel and our 2016 forecast is $70. We note that geopolitical instability, particularly in the Middle East, may result in large deviations from our current price forecasts.

Shares are currently trading at 25.8 times 2016 EPS, compared to a five-year average of 9.9. The firm noted that its earnings estimates are depressed due to the sharp drop in oil prices, making the price-to-earnings (P/E) multiple much higher than it would be in a normal commodity price environment. Argus’s discounted cash flow model yields a fair value of $84 per share. It is also worth noting that ConocoPhillips’s dividend yield of 4.9% is above the peer average of 3.3%, and that the dividend remains the company’s highest priority.

Shares of ConocoPhillips were down 2% at $58.48 on Wednesday. The stock has a consensus analyst price target of $74.65 and a 52-week trading range of $58.24 to $87.09.

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