Dahlman Rose Raises XEC Target To $105

Cimarex Energy Co.

will likely continue to add rigs in the Permian and have total CAPEX of roughly $1.3Bn in 2011, Dahlman Rose reports. “This is well north of the $900MM it is spending in 2010. The increase comes from a higher rig count in both the Mid-Continent area (targeting the Cana and the Granite Wash) and in the Permian Basin (primarily targeting the Bone Spring),” Dahlman Rose writes. “Our 2011 estimated cash flows of $1.35 Bn should fully fund the CAPEX program. However, if the Bone Spring, Avalon, and Abo plays continue to see improved results and oil prices stay stong, we expect the company could choose to further ramp up activity in the Permian Basin above those cash flows.” Dahlman Rose has raised its PT to $105. Cimarex Energy currently trades at $88.85.