Last year was considered a total reversal of fortune for major oil companies. While some of the second-tier and third-tier oil players saw massive gains, rather impressive gains were seen in shares of Chevron Corp. (NYSE: CVX) and Exxon Mobil Corp. (NYSE: XOM). But it seems that one key analyst is changing its tune on one of the majors in this sector.

For the most part, Wells Fargo has maintained its ratings for integrated oil and gas and international exploration and production companies within its coverage universe, with one key exception: Exxon. 24/7 Wall St. also has taken a broad look at the bullish and bearish case for Exxon and Chevron.

This analyst downgraded Exxon to a Market Perform rating from Outperform and updated production estimates, margin expectations and the commodity price deck. Wells Fargo had expected Exxon to be able to pursue an acquisition during the oil price downturn as a way to deliver growth and returns. However, with that window likely closed for now, plus its premium valuation, the firm is stepping back to neutral.

Wells Fargo also cut its earnings per share (EPS) estimates to $2.19 and $4.28 from prior levels of $2.26 and $4.27, in 2016 and 2017, respectively. The valuation range also dropped to $87 to $93 from the previous range of $92 to $100.

Apart from this, the firm’s top pick in the international exploration and production segment is Suncor Energy Inc. (NYSE: SU) based on the combination of its integrated business model, favorable production outlook, modest capital requirements, path to improving returns and likely share repurchase potential. In addition, the firm maintained an Outperform rating on ConocoPhillips (NYSE: COP), Canadian Natural Resources Ltd. (NYSE: CNQ) and Occidental Petroleum Corp. (NYSE: OXY).

As a result, Wells Fargo has updated its oil price deck and earnings estimates and valuation ranges through 2019 for all of its oil and gas producing stocks. In the firm’s view, ConoccoPhillips possesses one of the lowest all-in cash operating breakeven levels in the sector. Occidental remains favorably positioned in the Permian Basin and should deliver some of the strongest production growth through 2019 based on Wells Fargo’s outlook. Canadian Natural Resources, similar to Suncor, offers a visible growth path through 2019 with favorable cash flow dynamics.

Wells Fargo detailed in its report:

Adjustments to our EPS estimates primarily reflect our updated commodity price forecasts and slight adjustments to our production forecasts. For the international E&Ps, we have taken earnings forecasts out to 2019E and have adjusted our valuation ranges to be based off of our 2019E estimates. Upward revisions to our integrated oil and gas coverage reflect adjustments to our crude price deck.

Shares of Exxon were trading at $86.48 on Wednesday. The consensus price target is $88.64 and the 52-week trading range is $71.55 to $95.55.

Suncor shares were last seen at $32.48, with a consensus price target of $36.13 and a 52-week range of $18.71 to $33.79. Wells Fargo maintained an Outperform rating and raised its valuation range to $53 to $57 from the previous range of $52 to $56. The firm altered its EPS estimates to −$0.27 and $1.63, from the previous estimates of −$0.44 and $1.61, in 2016 and 2017, respectively.

Shares of Canadian Natural Resources were trading at $31.17, with a consensus price target of $37.87 and a 52-week range of $14.60 to $35.28. Wells Fargo maintained an Outperform rating and raised its valuation range to $49 to $53 from the previous range of $48 to $52. The firm altered its EPS estimates to −$0.86 and $1.07, from the previous estimates of −$0.57 and $1.06, in 2016 and 2017, respectively.

ConocoPhillips was trading at $50.28. The consensus price target is $56.00, and the 52-week range is $31.05 to $53.17. Wells Fargo maintained an Outperform rating and raised its valuation range to $56 to $59 from the previous range of $52 to $56. The firm altered its EPS estimates to −$2.84 and $1.99, from the previous estimates of −$2.87 and $2.27, in 2016 and 2017, respectively.

Occidental shares were trading at $69.30, with a consensus price target of $76.74 and a 52-week range of $58.24 to $78.48. Wells Fargo maintained an Outperform rating and raised its valuation range to $80 to $84 from the previous range of $79 to $84. The firm altered its EPS estimates to −$0.87 and $1.84, from the previous estimates of −$0.81 and $1.74, in 2016 and 2017, respectively.

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