Stifel Nicolaus Reiterates Hold Rating on EXCO Resources Following Eagle Ford/Haynesville Purchase Announcement

In a report published Friday, Stifel Nicolaus analyst Amir Arif reiterated a Hold rating on EXCO Resources XCO. In the report, Stifel Nicolaus noted, “Wednesday morning before the market open, XCO announced the purchase of oil-weighted assets in the Eagle Ford, a bolt-on acquisition in the Haynesville, and the signing of a non-binding JV for Eagle Ford development with KKR. An asset acquisition was expected, as XCO has long signaled an interest in acquiring oily assets in an effort to transform itself from being nearly completely dry-gas weighted. Overall, the acquisition was a net positive, as it adds an oily Eagle Ford position at what we believe is a reasonable valuation ($12,363/acre or $111,475/boe/d valuation) and helps XCO begin a transformation from a strictly gas name to one with liquids growth potential.” EXCO Resources closed on Wednesday at $8.05.