Stifel: "CXO is one of the most attractive M&A targets"

[dan_s]

Best pull-back opportunities based on last week’s earnings – BOOM, CXO, KRP, WMB
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CXO - In our view, the violent sell-off was attributable to asset and capital efficiency concerns, which in turn place 2020 estimates at risk.
We believe those concerns are overblown as the primary driver (Dominator pilot) is not a $3.2B development. At most, the Dominator was a
$100mm pilot with a -$40mm PV-10 impact. Additionally, M&A remains an investable theme and CXO is one of the most attractive M&A targets.
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BOOM - We believe the sell-off post robust 2Q results was due to market share worries. Although peers are introducing more competitive
products, we believe BOOM is extremely well-positioned to capture a larger piece of the expanding integrated perforating gun market.