UPDATE: Wunderlich Securities Initiates Coverage on LRR Energy LP with Hold Rating, $17 PT on Lack of Near-Term Growth Catalyst

In a report published Friday, Wunderlich Securities analyst Abhishek Sinha initiated coverage on

with a Hold rating and $17.00 price target. In the report, Wunderlich Securities noted, “We are initiating coverage of LRR Energy, L.P. (LRE), with a Hold rating and $17 price target. LRE is an oil & gas upstream MLP headquartered in Houston, TX, that went public in November 2011. Assets are located in the Permian, Mid-Continent, and the Gulf Coast regions of the U.S. LRE has a liquids-rich portfolio supported by a solid hedging strategy and subordinated units that strongly safeguard its distributions to common unitholders. However, the company is 78% drawn against its credit facility, has a modest coverage ratio, and lacks near-term drop-down prospects from its sponsor. Limited financial flexibility and lack of near-term growth catalysts could keep the stock range bound, in our view. Accordingly, we are initiating coverage on LRE with a Hold rating.” LRR Energy LP closed on Thursday at $16.22.