Continental Resources, Inc. CLR is well-positioned to benefit from improved leverage next year; has exposure to potentially higher oil prices; and could deliver robust free cash flow, according to KeyBanc Capital Markets.
The Continental Resources Analyst: Leo Mariani upgraded Continental Resources from Sector Weight to Overweight with an unchanged $20 price target.
The Continental Resources Thesis: The company may receive more than $500 million from the sale of its water infrastructure assets, which it could use to pay down “a nice chunk of its debt,” Mariani said in an upgrade note.
“We expect CLR will be able to stem oil production declines in 2021, as we expect it to add Bakken activity in 2021, and we expect CLR to transition its Oklahoma activity from gas producing areas back to oil in 1H21,” the analyst said.
“Additionally, we expect both CLR's 2021 total production and 2021 oil production to come in 3% above consensus. We also expect CLR's oil production to show modest sequential declines in 1H21, before resuming modest growth in 2H21.”
Benchmark expects Continental Resources to reinstate its dividend in 2021.
CLR Price Action: Shares of Continental Resources were up 1.35% at $16.48 at last check Tuesday.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.