UPDATE: Brean Murray Carret & Co. Initiates Coverage on Penn Virginia

According to a research report published this morning, Brean Murray Carret & Co. has initiated Penn Virginia PVA with a Buy rating and $10 PT. Brean Murray Carret & Co. said, "Proceeds from the company's anticipated Granite Wash divestiture should shift market focus from liquidity concerns to the value of its Eagle Ford oil window acreage. The sale announcement, expected in early 3Q, provides the most impactful near‐term catalyst, followed by Eagle Ford acreage de‐risking from the 4 Lavaca County and 17 Gonzales County wells that PVA plans to drill in the remainder of 2012. The company's 55‐77% year‐over‐year 2012 oil production growth guidance looks conservative by ~25% compared to our Eagle Ford build‐up model. Our thesis on PVA is that consistent Eagle Ford well results, de‐risking in Lavaca County, and beats on crude oil production volumes this year provide a clear path to value accretion once the company's Granite Wash sale is consummated." Penn Virginia closed Friday at $4.82.
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Posted In: Analyst ColorInitiationAnalyst RatingsBrean Murray Carret & Co.
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