UPDATE: Imperial Capital Initiates Coverage on Basic Energy Services

In a report published Tuesday, Imperial Capital analyst Scott Levine initiated coverage on Basic Energy Services BAS at Outperform, establishing a $20.00 price target. According to the report, BAS is well positioned to benefit from a recovery in U.S. onshore E&P capex, given its diverse service portfolio and attractive geographic footprint. "BAS has an established presence in several attractive basins, which should enable it to benefit from a rebound in oilfield service demand, which we expect to gain momentum in FY14,” the report noted. “The company's assets are particularly well positioned in oily basins such as the Permian and Eagle Ford, which should enable it capitalize on any increase in capex tied to greater E&P activity in these areas. Although activity in gas-rich fields remains anemic, the company's established presence in the Ark-La-Tex and Marcellus regions should ensure that BAS will benefit from any resumption in gas development activity if market conditions improve.” BAS closed Friday at $17.25 with shares trading up at 2.62 percent.