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UPDATE: Goldman Sachs Reiterates Buy Rating, Raises PT on Pioneer Natural Resources

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In a report published Monday, Goldman Sachs Group reiterated its Buy rating on Pioneer Natural Resources (NYSE: PXD), and raised its price target from $131.00 to $136.00.

Goldman Sachs noted, “After meetings in Midland last week, we have greater confidence in horizontal Wolfcamp Shale resource potential in the Midland Basin, and we are raising our 6-month DCF- and multiples-based target price to $136 from $131. While we are not adjusting our earnings and EBITDA estimates, we believe a greater multiple is warranted to reflect a longer resource life (greater growth longevity) as we now assume a wider areal extent of horizontal drilling opportunities on PXD's Midland Basin acreage. Specifically, we assume about 23% of the company's 900K gross acre position is prospective vs. 20% previously – we use higher percentages in the southern portion of the play due to greater drilling activity to date. Our revised assumptions are more than 80% below company estimates that call for 3.5 billion BOE from horizontal Wolfcamp potential – if we see new evidence of greater resource recoverable at attractive rates of return, we see further potential upside to our target price.”

Pioneer Natural Resources closed on Friday at $102.15.

Latest Ratings for PXD

DateFirmActionFromTo
Dec 2014Howard WeilUpgradesSector OutperformFocus Stock
Dec 2014BarclaysMaintainsEqual-weight
Dec 2014Deutsche BankMaintainsHold

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