UPDATE: Global Hunter Securities Downgrades Approach Resources to Neutral; More Organic Growth Needed
Global Hunter Securities reduced its rating on Approach Resources (NASDAQ: AREX) from Buy to Neutral and lowered its price target from $40 to $30.
Global Hunter Securities noted, "We're heading to the sidelines with a Neutral rating (from Buy) on AREX until we see evidence that the conclusion of company's infrastructure buildout results in a significant ramp in the trajectory of production growth (outpacing gains in net debt and the share count is a must), and also brings forth a meaningful reduction in F&D and LOE costs. We are reducing our price target from $40 to $30, which is NAV based and represents an 8.1x multiple of 2013E EBITDAX."
Approach Resources closed at $25.28 on Tuesday.
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