Stifel's take on PXD + PE merger - Oct 28

[dan_s]

Pioneer Natural Resources Company (PXD, $83.78, Buy; Target $149.00) < Compares to my valuation of $123
PE acquisition supercharges an already superior investor value proposition - Derrick Whitfield, energy sector analyst at Stifel

We have updated our model to reflect Pioneer's acquisition of Parsley Energy (PE) announced on October 20, 2020. As previously noted, we view the transaction as slightly positive for Pioneer as it enhances the stock's return-of-capital metrics. More specifically, PXD is the only stock without federal risks in our Bellwether universe that could return 100% of its enterprise value by 2027 assuming strip prices. Based on our assessment, the PE transaction accelerates this asset productivity test by approximately one year (from 2028 to 2027). While the transaction indicates Pioneer is not a near-term seller, we believe the combined company is unquestionably stronger and could still be a target for the U.S. Majors.

TipRanks 10-28-2020: "In the last 3 months, 18 ranked analysts set 12-month price targets of $95 to $162 for PXD. The average price target among the analysts is $122.24."