UPDATE: Stifel Upgrades Magnum Hunter Resources Corp. to Buy, Names $11 PT on Good Upside Potential

In a report published Monday, Stifel analyst Amir Arif upgraded the rating on Magnum Hunter Resources Corp. MHR from Hold to Buy, and named an $11.00 price target. In the report, Stifel noted, “We are upgrading MHR from Hold to Buy, with an $11 target price. We believe that the private placement announced last week removes any equity offering overhang/concern for the coming 12 months and during that timeframe, we expect for MHR's SE Utica acreage position to firm up meaningfully, which should firm up our 1yr/3yr NAV of $12/$28. With meaningful upside potential to the NAV from current levels, the 2014 funding gap concerns removed, and the expectation that our NAV is firmed up in the coming year, we would be buyers of the stock, despite its higher leverage and ongoing CF outspend. We expect the NAV to be firmed up through 1) the increase in rig count from 2 to 3 in the Marcellus/Utica by July, 2) the release of production data on eight new Utica wells by YE (versus one well so far), 3) and through the Stuart Winland pad in Tyler County, WV derisking the Utica extension further SE into West Virginia, with results expected in August 2014.” Magnum Hunter Resources Corp. closed on Friday at $7.66.