Top Picks from Piper Sandler - Aug 16

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dan_s
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Joined: Fri Apr 23, 2010 8:22 am

Top Picks from Piper Sandler - Aug 16

Post by dan_s »

Note from the energy sector team at Piper Sandler

We revise estimates for our E&P coverage following 2Q22 earnings with the primary
themes remaining cost inflation and capital return, while we also got some initial color on
the 2023 outlook. There was expectation that inflation would drive higher 2022 capital,
but investors were also receptive to incremental activity with CRK and CTRA adding 2022
spuds. On the return front, we got incremental return messages from MUR, while multiple
companies were opportunistic with buybacks in the wake of the June pullback including
CHRD, FANG and RRC. While the Inflation Reduction Act was not broadly a concern for
the group either due to size ($1bn book net income) or current cash tax status, it did raise
some concerns around MRO, though we would argue it should not be a big overhang for
the stock. Our top picks in E&P are FANG, MRO, EQT and NOG

Piper Sandler's updated price targets for the Sweet 16 that they cover
CLR = $70
CRK = $19
EOG = $158
EQT = $62 < the only one that is higher than my current valuations
LPI = $103
MGY = $33
NOG = $50
RRC = $44
Dan Steffens
Energy Prospectus Group
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