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40% Return Potential For PDC Energy? Goldman Sachs Thinks So

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In a report published Monday, Goldman Sachs analysts initiated coverage of PDC Energy Inc (NASDAQ: PDCE) with a Buy rating and a price target of $77.

PDC Energy is a $2.2 billion E&P company operating in the Wattenberg and Utica regions. The company's strengths lie in its low cost structure and a strong energy base.

"We see an easing of the midstream constraints that kept PDCE's Wattenberg production flat through 2014. We also expect a record 40-45 gross operated Wattenberg wells to be turned online in 2Q, which should help drive a step-up in near-term growth," the analysts mentioned.

The company's oil production in the coming months is expected to surpass the average level achieved by its peer group. "We see PDCE growing oil production in 2Q-4Q 2015 by 41% and a further 31% in 2016, significantly higher than the 1%/13% average seen for peers," the report stated.

PDC Energy's shares have outperformed driven by improved oil equity sentiment. "However, we see room for additional outperformance as PDCE approaches an inflection in growth/resource in 2H15 after sub-par execution in 2014," the analysts commented.

Latest Ratings for PDCE

DateFirmActionFromTo
Jul 2017Bank of AmericaReinstatesBuyBuy
Jun 2017Credit SuisseDowngradesOutperformNeutral
Dec 2016Goldman SachsDowngradesBuyNeutral

View More Analyst Ratings for PDCE
View the Latest Analyst Ratings

Posted-In: Goldman SachsAnalyst Color Initiation Analyst Ratings

 

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