Canaccord Genuity Reiterates Buy Rating, $42 PT on Energy XXI (Bermuda) Ltd.

In a report published Wednesday, Canaccord Genuity reiterated its Buy rating and $42.00 price target on Energy XXI (Bermuda) Limited EXXI. Canaccord Genuity noted,“We like EXXI for its oil-weighted asset base, consistent cash generation, and potential upside from its ultra-deep program...The horizontal drilling opportunity for EXXI on the Gulf of Mexico Shelf is significant. We expect to see a broader list of oily horizontal opportunities in the near future as the company further analyzes its deep prospect inventory. While the first well currently drilling at the Vermillion 179 JV with ExxonMobil is exploratory and carries a higher degree of risk, we walked away even more convinced that if this well is successful, it could be a significant discovery and a needle mover for the company. The well, Pendragon, is currently drilling below 4,500 ft. to a proposed total depth of 20,300 ft. EXXI is carrying XOM on the first two wells to earn a 50% working interest. There are 7 prospect areas on 54,500 acres in the JV. The company has discussed significant resource potential here, ranging from 375 MMBoe to over 2 BBoe.” Energy XXI (Bermuda) Limited closed on Tuesday at $32.92.