UPDATE: Morgan Stanley Initiates Coverage on Seventy Seven Energy with Equal-Weight Rating, $29 PT on High Leverage Growth Story, Execution Risk

In a report published Thursday, Morgan Stanley analyst Ole Slorer initiated coverage on

with an Equal-Weight rating and $29.00 price target. In the report, Morgan Stanley noted, “Following spin-off from CHK, SSE is trading at a ~15% discount to our $29 SOTP estimate, and we therefore view SSE as a value opportunity within the booming NAm onshore service market. However, we acknowledge risk on execution and leverage. Initiate with an EW rating and a $29 PT.” Seventy Seven Energy closed on Wednesday at $25.07.