Good 2nd quarter results
This morning, Stifel raised RRC to a BUY with a $52.00 price target.
Range Resources (RRC)
Range Resources (RRC)
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Range Resources (RRC)
After RRC released Q2 Results:
> KLR GROUP UPGRADES RANGE RESOURCES TO BUY
> S&P GLOBAL MAINTAINS BUY OPINION ON SHARES OF RANGE RESOURCES CORPORATION: "We raise our 12-month target by $2 to $47, on a 10X price to '17 cash flow multiple, in line with peers. We narrow our '16 loss per share estimate to $0.31 from $0.54 and adjust '17's EPS to a $0.13 gain from a $0.48 loss. RRC posts a Q2 loss per share of $0.14 vs a $0.01 gain, $0.04 above Capital IQ consensus. While we note a cautious approach in regards to drilling, RRC has greatly reduced land costs and are largely held by production (HBP). As such, this offers the ability to ramp drilling quicker than peers when commodity prices warrant, a material advantage in our view."
> KLR GROUP UPGRADES RANGE RESOURCES TO BUY
> S&P GLOBAL MAINTAINS BUY OPINION ON SHARES OF RANGE RESOURCES CORPORATION: "We raise our 12-month target by $2 to $47, on a 10X price to '17 cash flow multiple, in line with peers. We narrow our '16 loss per share estimate to $0.31 from $0.54 and adjust '17's EPS to a $0.13 gain from a $0.48 loss. RRC posts a Q2 loss per share of $0.14 vs a $0.01 gain, $0.04 above Capital IQ consensus. While we note a cautious approach in regards to drilling, RRC has greatly reduced land costs and are largely held by production (HBP). As such, this offers the ability to ramp drilling quicker than peers when commodity prices warrant, a material advantage in our view."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Range Resources (RRC)
While updating my forecast model for RRC, I have noticed that there is a wide variation in the revenue, cash flow and EPS forecasts submitted to First Call by other analysis. This is because some firms are not including the impact of the merger with MRD. Actually, a merger is not closed until it actually does close but I do think the odds are 99% that this one does close. It is a "Win-Win" for shareholders of both companies.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Range Resources (RRC)
My valuation of RRC increases by $0.20/share to $48.00, compared to First Call's Price Target of $48.84.
There is a lot more upside for RRC, but I just want to wait until the merger closes and we get some good production forecast numbers from management for 2017. I have followed RRC closely for over 15 years. This is a world-class company with top shelf management. It is definitely one of our "Elite Eight".
FYI if natural gas prices do go to more than $4.00/mcf my valuation will jump to near $60/share. RRC is almost a "pure play" on natural gas.
There is a lot more upside for RRC, but I just want to wait until the merger closes and we get some good production forecast numbers from management for 2017. I have followed RRC closely for over 15 years. This is a world-class company with top shelf management. It is definitely one of our "Elite Eight".
FYI if natural gas prices do go to more than $4.00/mcf my valuation will jump to near $60/share. RRC is almost a "pure play" on natural gas.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group