BofA Picks Top Argentina Oil & Gas Stocks By Investing.com

The market is starting to re-rate Argentina as a macro beta with optionality rather than a broken-risk jurisdiction, and that matters more for these names than the specific target bumps. For VIST and YPF, lower sovereign stress does two things at once: it improves the equity discount rate and it expands the set of buyers willing to underwrite longer-duration production growth, which is the real driver of multiple expansion. That creates a second-order benefit for domestic service providers and midstream infrastructure tied to Vaca Muerta, while higher-cost conventional producers likely become the funding source for further portfolio simplification and asset sales.

VIST looks like the cleaner expression because the catalyst stack is narrower, faster, and more mechanically accretive. The acquisition angle is important not just for reserves, but because it increases operator control over capital allocation in a basin where execution quality drives IRR dispersion more than commodity price does. If the RIGI treatment lands as expected, the market may start capitalizing the asset as a quasi-infrastructure compounder rather than a pure E&P, which can sustain a higher multiple even if Brent softens.

YPF is a broader, more political trade: the upside is bigger if reform momentum continues, but the path is less linear because LNG and conventional divestments are multi-quarter milestones. The contrarian risk is that investors are over-discounting policy continuity after the elections; any delay in reforms, FX normalization, or fiscal credibility would hit WACC-sensitive equity duration immediately. That makes YPF more vulnerable to a sharp factor unwind if country risk stops improving, while VIST should hold up better on asset-level catalysts.

The cleanest read is that the move is only partially priced because consensus still treats Argentina as a top-down call, when the more important driver is basin-level capital efficiency under a lower-risk regime. The tradeable edge is timing: macro sentiment can rerate in days, but production and project execution take months, so there is a window where the stocks can continue to rerate before operational numbers fully catch up. The biggest miss is that lower country risk also improves the valuation of adjacent local assets, so the rally may broaden beyond these two names if international capital starts looking for a new EM energy reopening story.