In a report published Thursday, Stifel Nicolaus analyst Amir Arif upgraded Cabot Oil & Gas COG from Hold to Buy, and named an $85.00 price target.
In the report, Stifel Nicolaus noted, “Yesterday after the close, COG posted a solid cash flow beat, increased 2013 production/capex guidance, and announced plans to increase its Marcellus rig count from five to six. We expect the stock to be up today on the increased 2013 guidance. More importantly for long-term investors, the additional Marcellus rig increases our 2014 CFPS estimate, which was already above consensus, from $8.31 to $8.56 (vs. consensus of $7.98). The increased 2014 CFPS outlook, the improved visibility surrounding that outlook, and the fact that gas has corrected from earlier this year (a concern in our March 26th downgrade), lead us to upgrade the name back to a Buy with an $85 target price. This reflects a 9.0x 2014E EV/EBITDA target multiple.”
CAbot Oil & Gas closed on Wednesday at $71.71.
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