J.P. Morgan initiated coverage of Saudi Arabian Oil Co. SA:2222 +0.42% , known widely as Saudia Aramco, with an overweight rating and a price target of 37.00 Saudi riyals per share, which is 6.6% above current levels and suggests a fair value for the oil giant of $2 trillion. That valuation compares with the S&P 500's largest U.S. energy company by market capitalization, Exxon Mobil Corp. /zigman2/quotes/204455864/composite XOM -0.23% , at $292.8 billion. Analyst Christyan Malek said key drivers for Aramco include an "increased appetite" from the Kingdom of Saudia Arabia to regain market share of global oil demand, in the context of a tightening of oil market deficit, and a rising call from captive refining commitments. "Aramco effectively offers minority shareholders 'bond with equity upside' type properties," Malek wrote in a note to clients. "Premium barrels, capex flexibility, captive crude demand through vertical integration into the eastern hemisphere (where we expect most marginal LT growth to emerge) and low gearing enable Aramco to commit to distributing a structurally higher percentage of cashflow through the cycle." The stock,which went public on Dec. 12, has declined 5.7% since then, while the SPDR Energy Select Sector ETF /zigman2/quotes/206420077/composite XLE -0.66% has slipped 1.5% and the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.77% has gained 3.6%.