ConocoPhillips shares fell in Q2 as the US-Iran peace deal reopened the Strait of Hormuz and removed the war risk premium, Diamond Hill Capital said. AlphaScore 59.
ConocoPhillips shares fell in the second quarter after the US and Iran reached an agreement to end their war and reopen the Strait of Hormuz, according to Diamond Hill Capital's latest investor letter. The energy company, which produces crude oil, natural gas, and LNG, was a detractor from the Diamond Hill Large Cap Strategy's performance during the period.
The fund's Q2 2026 letter said the market increasingly viewed the risk of a meaningful supply disruption as diminished following the accord. "The war-related risk premium that had supported US exploration and production companies earlier in the year largely dissipated," Diamond Hill wrote.
ConocoPhillips closed at $120.48 on July 31, giving it a market cap of $146.78 billion. The stock posted a one-month return of 14.52% and a 52-week gain of 27.75%. Diamond Hill's Large Cap Strategy returned 3.42% net of fees in the quarter, trailing the Russell 1000 Value Index's 13.87% gain.
The fund said stock selection in tech, health care, and industrials hurt relative performance. AI remained the dominant market theme, driving an 81% gain in the technology sector, while energy declined after oil prices fell on the Iran deal. The strategy's limited exposure to companies benefiting from AI-related capital spending caused most of its underperformance, Diamond Hill said.
74 hedge fund portfolios held ConocoPhillips at the end of the first quarter, up from 65 in the previous quarter, according to Insider Monkey data. The stock carries an AlphaScore of 59 out of 100 from AlphaScala, a moderate rating within the energy sector.
Read the full Diamond Hill Q2 2026 letter on the fund's website.
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