UPDATE: Stifel Nicolaus Upgrades Suncor Energy to Buy

Stifel Nicolaus raises its rating on Suncor Energy

to Buy from Hold as operational improvements in 1H12 operational improvements should move the name higher. Price target is established at $42. Stifel Nicolaus says, "What should allow the name to start outperforming in 1H12 is operating results, which should show a ramp-up in high quality SAGD volumes, lower mining opex, improved upgraded volume reliability, and potential for 2H volume and costs to improve above current guidance, in our view. As a result, we are upgrading SU to a Buy with a US$42 target price, reflecting 85% of our risked NAV and 6.4x 2012E EV/EBITDA target multiple." SU closed at $34.33 a share on Thursday.