UPDATE: J.P. Morgan Raises PT on PetroQuest Energy to $9 (PQ)
J.P. Morgan is out with its report on PetroQuest Energy (NYSE: PQ), raising its PT from $8.50 to $9.
In a note to clients, J.P. Morgan writes, "Given our negative view on the gas market, PQ's leverage to gas could cause the stock to decline. PQ is one of the most leveraged names to natural gas, but the company is working to grow its liquids production. Production declines from the company's Gulf of Mexico and Gulf Coast assets mute PQ's growth from its unconventional onshore programs. As PQ's shorter reserve-life production becomes a smaller percentage of the company's total production, the asset base becomes easier to grow in 2012 and beyond. We think PQ's strong balance sheet and improving asset base could help the stock outperform. Our Dec 2011 price target of $9.00 approximates our estimate of current NAV, which we calculate using a discounted cash flow model."
Shares of PQ closed Tuesday at $9.28.
