According to J.P. Morgan, Approach Resources' AREX model is updated for 10-K data.
J.P. Morgan reported that it is updating its NAV and price target based on YE10 proved reserves. “Further, we are adjusting our earnings and cash flow estimates based on marked-to-market 1Q11 commodity prices. In our view, the most important company-specific catalyst is the upcoming result of its first horizontal Wolfcamp well (possibly within a few weeks). Data from other operators (especially EOG and EP) also can move the stock. The value of AREX has significant leverage to the horizontal Wolfcamp play, so success can impact the stock meaningfully. We increased our price target to $25/share from $24/share based on our calculated NAV of $25.22/share after updating for YE10 proved reserves.”
Approach Resources closed yesterday at $31.00.
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