Citi: Range Resources' 2012 Guidance on the Rise

In a recent research report published by Citi, Range Resources'

production growth guidance for 2012 was raised to ~30-35% from 25-30%. In the report, Citi commented, “As expected, oil and NGL output is projected to be up ~35% while natural gas volumes are projected to increase by ~30%, driven primarily by rising associated gas volumes from the Marcellus. Range pegged the 2012 capital budget at $1.6bn, which is flat year over year but above our current cash flow estimate of ~$0.8bn. Three-quarters of the budget is for the liquids-rich portion of the Marcellus along with the Mississippian Lime and Cline shale oil plays. In 2013, the company stated that it can grow production 15-20%, which is below our current forecast, with a capital program equal to currently anticipated cash flow.” Citi maintains its Buy rating and $65 PT on Range Resources, which closed yesterday at $64.27.