UPDATE: Wunderlich Securities Initiates Diamondback Energy at Hold on Valuation
Wunderlich Securities initiated coverage on Diamondback Energy (NASDAQ: FANG) with a Hold rating and an $18 price target.
Wunderlich Securities commented, "The company has rapidly grown its position through acquisitions and used the funds generated from its recent initial public offering to pay off its existing debt. Going forward Diamondback intends to ramp activity significantly in order to grow production and cash flows as it exploits its oily acreage position. While we like the strong asset base and potential upside catalysts for Diamondback, we believe the stock is relatively fairly valued at this time until we get a better handle on the 20-acre spacing and/or horizontal upside potential. Diamondback currently trades at a 4.5x 2013 P/CFPS multiple versus peers trading at 4.6x"
Diamondback Energy closed at $16.71 on Monday.
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Tags: Wunderlich Securities