Topeka Capital reported on Monday that it is cut its rating on oil and gas company Pioneer Natural Resources (PXD
The firm has downgraded PXD from “Buy” to “Hold,” due to a valuation call. Topeka Capital has also lowered the company’s price target from $200 to $195. This price target suggests a 5% upside from Friday’s closing price of $184.83.
Analyst Gabriele Sorbara commented: “Following the recent outperformance, we believe PXD is sufficiently valued on 2014/2015 EBITDA generation and relative to RNAV. While we believe PXD stands alone as the premier player with more than 700,000 net acres prospective for the Wolfcamp shale in the Midland Basin, the current valuation awards a paramount premium to the group.”
“Further, the numerous catalyst wells with 3Q13 results add no incremental value to our RNAV and growth upside, given our production and RNAV valuation model factor in a ramp to 50 horizontal rigs in the Midland Basin by 2018 – also presenting execution risk, in our view,” the analyst added.
Pioneer Natural Resources shares were mostly flat during pre-market trading Monday. The stock is up 73% YTD.
No comments:
Post a Comment