Deutsche Bank’s Josh Silverstein sees both Antero Resources Corp
Silverstein upgraded the rating on both companies from Hold to Buy, while raising the price target for Antero Resources from $27 to $30 and for Rice Energy from $30 to $33.
“While we see rationale to be cautious ahead of winter, particularly given its importance to annual supply/demand balances, we also remain of the view that $3.00/mmbtu is still the bottom end of the balancing range for supply/demand,” the analyst mentioned.
Silverstein believes the company is one of the best positioned producers, given its growth, hedge book and asset base.
In addition, the risk/reward on the stock has been turning positive, especially when focusing on 2018, “with the caveat that they also offer the best protection for winter 2017 as they remain fully hedged.”
The stock has historically traded at a premium and the analyst expects the premium to return, given the visibility and
Silverstein also expects the company to take additional market share, with an over 20 percent growth rate expected going forward.
“While we had remained on the sidelines at RICE due to our position on natural gas price, we consistently favored the integrated business model and appreciated management’s disciplined approach to consolidation,” the analyst explained.
Silverstein pointed out that this was exemplified by the Vantage acquisition, which helped improve
The analyst expects the company to benefit from its “short firm transport capacity position as pipelines will likely be overbuilt in the basin.”
At Last Check
|Nov 2016||Deutsche Bank||Upgrades||Hold||Buy|
|Sep 2016||GMP Securities||Assumes||Hold|
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