Analysts’ Weekly Ratings Changes for QEP Resources (QEP)
A number of research firms have changed their ratings and price targets for QEP Resources (NYSE: QEP):
- 7/31/2017 – QEP Resources is now covered by analysts at National Securities. They set a “buy” rating and a $11.00 price target on the stock. They wrote, “• We are initiating coverage on QEP Resources with a BUY rating and $11 price target. Given the company’s current price (and our expectations for increased production and cash flows), we see QEP as trading at an unwarranted discount to intrinsic value. To that end, we compared QEP with a set of valuation multiples derived from a selection of industry peers. Additionally, we value QEP’s equity on the basis of daily production, proved reserves, and projected EBITDA. In doing so, we arrive at a value per share of $11, implying 33% additional upside, given current prices.
• QEP Resources has a strong base of reserves, along with an expanding presence in the Permian Basin. We note a diverse production profile for QEP, though we expect a deeper focus on the Permian, moving forward. As it stands, QEP holds 731.1 million barrels of oil equivalent (Mmboe), across the Permian Basin (TX), Williston Basin (ND), Haynesville Shale (LA), and Pinedale Anticline (WY). We note that approximately 14% of current production is driven by the aforementioned Permian assets, and expect that figure to increase moving forward. To that end, we expect that 6 of the 7 rigs currently being operated by QEP will be located in the Permian for the remainder of 2017.
• As Permian based production increases, we expect an expansion in operating margins as well. We expect QEP’s oil weighted production mix (35% in 2Q17) to increase as they make progress in the Permian, which in isolation is a 72% oil weighed asset. In turn, we contend that this positions QEP for expanded margins and increased EBITDA in future quarters. Additionally, with production costs of approximately $12 per boe (excluding interest expense and G&A), we see QEP as well positioned to generate positive cash flow, even in what we consider to be a tepid oil price environment.
• We base our price target on a blended average of QEP’s daily production, proved reserves, and projected EBITDA figures. In doing so, we arrive at a price target of $11 per share (Exhibit 11). Additionally, our model deducts $0.39 for a working capital deficit, while also deducting $7 per share for net debt. Thus, given the 33% implied upside to current prices, we initiate coverage on QEP with a BUY rating.
- 7/27/2017 – QEP Resources was downgraded by analysts at BidaskClub from a “sell” rating to a “strong sell” rating.
- 7/27/2017 – QEP Resources was downgraded by analysts at J P Morgan Chase & Co from an “overweight” rating to a “neutral” rating. They now have a $9.00 price target on the stock, down previously from $11.00.
- 7/19/2017 – QEP Resources was given a new $12.00 price target on by analysts at Cowen and Company. They now have a “buy” rating on the stock.
- 7/18/2017 – QEP Resources was downgraded by analysts at Deutsche Bank AG from a “buy” rating to a “hold” rating. They now have a $13.00 price target on the stock, down previously from $18.00.
- 7/7/2017 – QEP Resources had its “buy” rating reaffirmed by analysts at Barclays PLC. They now have a $10.00 price target on the stock.
- 6/27/2017 – QEP Resources had its “buy” rating reaffirmed by analysts at BMO Capital Markets. They now have a $11.00 price target on the stock.
- 6/15/2017 – QEP Resources is now covered by analysts at Wolfe Research. They set a “market perform” rating on the stock.
- 6/14/2017 – QEP Resources was upgraded by analysts at BidaskClub from a “strong sell” rating to a “sell” rating.
QEP Resources, Inc. (NYSE QEP) traded down 5.55% on Monday, hitting $7.49. The stock had a trading volume of 5,843,479 shares. The company’s market cap is $1.80 billion. The firm’s 50-day moving average is $9.33 and its 200-day moving average is $12.30. QEP Resources, Inc. has a 52-week low of $7.46 and a 52-week high of $21.12.
QEP Resources (NYSE:QEP) last released its earnings results on Wednesday, July 26th. The pipeline company reported ($0.12) earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of ($0.20) by $0.08. The firm had revenue of $383.70 million during the quarter, compared to analyst estimates of $413.27 million. QEP Resources had a negative return on equity of 4.24% and a negative net margin of 3.90%. QEP Resources’s revenue was up 15.0% compared to the same quarter last year. During the same period last year, the business posted ($0.23) earnings per share. Equities research analysts anticipate that QEP Resources, Inc. will post ($0.61) earnings per share for the current fiscal year.
In related news, CFO Richard J. Doleshek bought 12,500 shares of the firm’s stock in a transaction that occurred on Friday, July 28th. The stock was purchased at an average cost of $7.91 per share, for a total transaction of $98,875.00. Following the completion of the acquisition, the chief financial officer now owns 304,539 shares in the company, valued at approximately $2,408,903.49. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Julie Dill bought 5,000 shares of the firm’s stock in a transaction that occurred on Friday, July 28th. The stock was bought at an average price of $8.49 per share, with a total value of $42,450.00. Following the completion of the acquisition, the director now owns 5,525 shares of the company’s stock, valued at approximately $46,907.25. The disclosure for this purchase can be found here. Company insiders own 1.36% of the company’s stock.
QEP Resources, Inc is an independent crude oil and natural gas exploration and production company. The Company focuses on two regions of the United States: the Northern Region (primarily in North Dakota, Wyoming and Utah) and the Southern Region (primarily in Texas and Louisiana). The Company conducts exploration and production activities in North America’s hydrocarbon resource plays.
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