UPDATE: Canaccord Genuity Initiates Coverage on Matador Resources Co. with Buy Rating, $13 PT on Attractive Risk/Reward

In a report published Thursday, Canaccord Genuity analyst Ipsit Mohanty initiated coverage on Matador Resources Co.

with a Buy rating and $13.00 price target. In the report, Mohanty noted, “In just a year, Matador Resources (MTDR) has transformed its production mix from 6% to 37% oil with the entire growth coming from the highly prolific Eagle Ford play. But a production miss in 2012, low level of guidance in 1H13 and a lack of drilling inventory have collectively caused the stock to massively underperform since IPO in early 2012. We emphasize that the production miss was due to operational practices put in place that were deliberate and intended to increase well performance, reduce costs, and improve NAV. Meanwhile, with double-digit production growth forecast in 2013 and 2014 and an asset base in Eagle Ford and Permian, we believe MTDR presents an attractive risk reward story. Based on our price target of $13, we see 40% upside over 12 months. Our ‘bull case' scenario price target is $17.” Matador Resources Co. closed on Wednesday at $9.98.