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UPDATE: Raymond James Upgrades Precision Drilling Following AIMCo Share Sale

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In a report published Friday, Raymond James analyst Andrew Bradford upgraded the rating on Precision Drilling (NYSE: PDS) from Market Perform to Outperform, and reiterated the $11.50 price target.

In the report, Raymond James noted, “Alberta Investment Management Company (AIMCo) divested its 19% equity stake (56.6 mln shares) in Precision Drilling yesterday. As a result, the stock closed 9% lower (the TSX Composite Index was up 1%). A 9% one-day drop and the 26% return to our unchanged $11.50 target price compel us to re-rate the stock as an Outperformer. Management confirmed there have been no material changes to Precision's business fundamentals since its Oct-24 Q3 operational update. What has changed since yesterday is the value of Precision's shares. At 5.3x 2014E EV/EBITDA, Precision is the lowest valued contract driller in our coverage group. The average for the group is about 5.6x. Yesterday's 9% share price drop presents a provocative entry point for investors into Precision, in our view. We are raising our rating on Precision to Outperform. Our $11.50 target price is unchanged.”

Precision Drilling closed on Thursday at $8.75.

Latest Ratings for PDS

DateFirmActionFromTo
Nov 2014JefferiesMaintainsBuy
Jul 2014JefferiesMaintainsBuy
Jun 2014Clarkson CapitalInitiates Coverage onOutperform

View More Analyst Ratings for PDS
View the Latest Analyst Ratings

Posted-In: Andrew Bradford Raymond JamesAnalyst Color Upgrades Analyst Ratings

 

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