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UPDATE: Morgan Stanley Initiates Coverage on YFA SA

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In a report published Monday, Morgan Stanley analyst Bruno Montanari initiated coverage on YFA SA (NYSE: YPF) with Overweight and a $50.00 price target.

According to the report, a better than 2:1 bull:bear skew on YPF is seen, but the analysts call is geared to investors with a LT horizon. Renewed access to capital markets should allow YPF to develop its sizable shale resources, reversing five years of declining output.

The report noted three drivers leading to the Overweight rating:

-Access to external funding & technology -Resolution of expropriation overhang -Development of sizeable shale oil/gas plays

“YPF trades at a ~50% discount to global oil companies exposed to shale plays, mostly in the US,” the report said. “We find its multiple attractive for a LT investment opportunity.”

Some risks to YPF included lack of access to further funding options, lowering NAVs and expropriation overhang persisting through multi-year arbitration and lawsuits.

YPF closed Friday at $32.65 with share trading up at 1.02 percent.

Latest Ratings for YPF

DateFirmActionFromTo
Apr 2015JP MorganUpgradesNeutralOverweight
Mar 2015Bank of AmericaUpgradesUnderperform
Feb 2015JP MorganMaintainsNeutral

View More Analyst Ratings for YPF
View the Latest Analyst Ratings

Posted-In: Bruno Montanari Morgan StanleyAnalyst Color Initiation Analyst Ratings

 

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