UPDATE: BMO Capital Markets Downgrades Pengrowth Energy to Market Perform; Current Climate Challenging

BMO Capital Markets lowers its rating on Pengrowth Energy

from Outperform to Market Perform and reduces its price target from $10 to $9. BMO Capital Markets comments, "Ongoing global economic instability and soft domestic growth projections are putting downward pressure on equity and commodity markets. We anticipate Pengrowth to have a funding shortfall for the next few years while the Lindbergh SAGD Project is being built. Management plans to sell non-core assets to bridge the funding shortfall, which may be difficult in a buyers' market. While we believe that a long-life, low-decline project like Lindbergh makes sense for Pengrowth, it may be difficult to fund both the development and the current dividend payouts." PGH closed at $7.21 on Wednesday.