RBC Capital on 1/12/2021 increased its price target for PXD by $3 to $158. My updated valuation is $150.
"We updated our 4Q20 estimates to reflect final commodity prices and made other changes to our model based on our channel checks, data analytics, and conversations with the company. The 4Q20 earnings update is important because investors likely get a detail structure for long-term shareholder returns. PXD remains a favorite idea given its strong balance sheet, core assets that generate visible FCF, and acreage that is mostly on fee lands.
Our 4Q20 EPS/CFPS of $0.75/$3.58 increase by 20%/3% reflecting higher final commodity prices. Our estimates are above the $0.63/$3.41 Consensus but this could narrow as models are updated for final prices. Our model assumes $15 million of restructuring costs in CFPS for 4Q20 (PXD restructuring initiatives) and $125-150 million of severance costs in 1H21 (PE severance)."
My Q4 2020 forecast is $0.41 EPS and $3.23 operating cash flow per share.
Pioneer Natural Resources (PXD) Update - Jan 12
Pioneer Natural Resources (PXD) Update - Jan 12
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Pioneer Natural Resources (PXD) Update - Jan 12
Pioneer Natural Resources Company (NYSE:PXD) ("Pioneer") announced that Pioneer has completed its previously announced acquisition of Parsley Energy, Inc. (NYSE:PE) ("Parsley") following the approval by Pioneer and Parsley stockholders of all proposals necessary for completing the all-stock transaction.
PXD's daily production will go from ~365,000 Boe per day in Q4 2020 to ~545,000 Boe per day in Q1 2021. Their production mix is now approximately 58.7% crude oil, 18.3 % natural gas and 23.0% NGLs. Q1 2021 revenues should be $1.5 to $1.6 Billion. If Pioneer's realized oil price averages $50/bbl in 2021, their revenues should exceed $7.6 Billion this year. For more details, see my updated forecast/valuation model under the Sweet 16 tab on the EPG website. Operating cash flow should exceed $4.7 Billion this year.
At the special meeting of Pioneer stockholders held January 12, more than 99% of the shares of Pioneer common stock voting at the special meeting were cast in favor of the issuance of Pioneer common stock in connection with the transaction. At the special meeting of Parsley stockholders held today, more than 99% of the shares of Parsley common stock voting at the special meeting (and approximately 89% of the total outstanding shares) were cast in favor of the transaction.
As previously announced, Parsley stockholders will receive 0.1252 shares of Pioneer common stock for each share of Parsley common stock owned. After the close of trading on January 12, Parsley Class A common stock will no longer be listed for trading on the New York Stock Exchange.
In addition, in connection with the closing of the transaction, Matthew Gallagher and A.R. Alameddine have joined the Pioneer board of directors. Mr. Gallagher and Mr. Alameddine each served on Parsley’s board of directors until the closing of the transaction.
Scott D. Sheffield, CEO, stated, "We are excited to close our transaction with Parsley and begin delivering on the significant synergies provided by this combination. The transaction is expected to further strengthen our investment framework by improving our free cash flow profile and enhancing return of capital to shareholders. We appreciate the strong support from shareholders and are confident in the tangible and durable value created through this transaction, forming the premier Permian independent energy company."
Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, Texas, with operations in the United States. For more information, visit Pioneer’s website at www.pxd.com.
PXD's daily production will go from ~365,000 Boe per day in Q4 2020 to ~545,000 Boe per day in Q1 2021. Their production mix is now approximately 58.7% crude oil, 18.3 % natural gas and 23.0% NGLs. Q1 2021 revenues should be $1.5 to $1.6 Billion. If Pioneer's realized oil price averages $50/bbl in 2021, their revenues should exceed $7.6 Billion this year. For more details, see my updated forecast/valuation model under the Sweet 16 tab on the EPG website. Operating cash flow should exceed $4.7 Billion this year.
At the special meeting of Pioneer stockholders held January 12, more than 99% of the shares of Pioneer common stock voting at the special meeting were cast in favor of the issuance of Pioneer common stock in connection with the transaction. At the special meeting of Parsley stockholders held today, more than 99% of the shares of Parsley common stock voting at the special meeting (and approximately 89% of the total outstanding shares) were cast in favor of the transaction.
As previously announced, Parsley stockholders will receive 0.1252 shares of Pioneer common stock for each share of Parsley common stock owned. After the close of trading on January 12, Parsley Class A common stock will no longer be listed for trading on the New York Stock Exchange.
In addition, in connection with the closing of the transaction, Matthew Gallagher and A.R. Alameddine have joined the Pioneer board of directors. Mr. Gallagher and Mr. Alameddine each served on Parsley’s board of directors until the closing of the transaction.
Scott D. Sheffield, CEO, stated, "We are excited to close our transaction with Parsley and begin delivering on the significant synergies provided by this combination. The transaction is expected to further strengthen our investment framework by improving our free cash flow profile and enhancing return of capital to shareholders. We appreciate the strong support from shareholders and are confident in the tangible and durable value created through this transaction, forming the premier Permian independent energy company."
Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, Texas, with operations in the United States. For more information, visit Pioneer’s website at www.pxd.com.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group