UPDATE: Topeka Capital Markets Initiates Coverage on SM Energy Co. with Hold Rating, $62 PT on RNAV Upside

In a report published Wednesday, Topeka Capital Markets analyst Gabriele Sorbara initiated coverage on SM Energy Co.

with a Hold rating and $62.00 price target. In the report, Sorbara noted, “We are initiating coverage of SM Energy Company (SM) with a Hold rating and price target of $62.00 per share. While the SM story is attractive on an EV/EBITDA basis and there is RNAV upside, we believe shares will remain at a discount to peers in the near-term, given the lack of catalysts and data points from its new ventures. We see a possible re-rating with success among the numerous emerging horizontal zones in the Permian Basin, where the Company has accumulated approximately 120,000 net acres, although we view this as a 2014 and beyond event.” SM Energy Co. closed on Tuesday at $59.55.