In a report published Monday, Deutsche Bank analyst Stephen Richardson downgraded the rating on Magnum Hunter Resources Corp. MHR from Buy to Hold, and lowered the price target from $7.00 to $3.50.
In the report, Richardson noted, “Led by a downward spiral in crude price, E&Ps are stumbling into quarterly results, with the EPX down 10% over the past four weeks, despite the natural gas front month increasing by 11% over the same period. With the stocks rebased, valuations are more attractive, with group average 2014 EV/DACF multiple down to 5.9x at $88/bbl WTI and $4.25/mmmbtu NG – with the biggest debate seemingly whether $88/bbl is the right number. We have updated our Q1 expectations and outline quarterly commodity trends within. We still favor top-picks EOG and XEC into the print.”
Magnum Hunter Resources Corp. closed on Friday at $2.63.
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