UPDATE: Citigroup Reiterates Buy Rating, Raises PT on Pioneer Natural Resources on 2013 Production Guidance

In a report published Friday, Citigroup reiterated its Buy rating on Pioneer Natural Resources PXD, and raised its price target from $120.00 to $148.00. Citigroup noted, “Pioneer issued 2013 production guidance of 12-16% growth (175-181 MBOE/d) while we forecast ~181 MBOE/d (including Barnett) and would note that guidance is predicated on Hz Wolfcamp/Spraberry EURs of 575 MMBOE/well even though long-lateral wells to date are trending above 650 MMBOE. For 2013-2015, management targets production growth at a 13-18% CAGR and we project growth of ~15% yr/yr in 2014 and ~16% in 2015. Pioneer priced a 9mm common share offering and raised ~$1.2bn to fund accelerated testing of the northern Hz Wolfcamp/Spraberry play, issued updated cost guidance and also added slightly to its 2014 crude oil hedges (~69% of projected output). Therefore, we have adjusted our EPS/CFPS estimates (see page 8) which decrease primarily due to the dilution resulting from the share offering, which boosted the outstanding common share count by ~7%.” Pioneer Natural Resources closed on Thursday at $128.60.