Recent oil highs and upbeat commentary from BP plc BP are bullish indicators for Kosmos Energy Ltd KOS, which has 25-percent upside potential, according to RBC Capital Markets.
The Analyst
Analyst Al Stanton upgraded Kosmos Energy from Sector Perform to Outperform and raised the price target from $7 to $10.
The Thesis
Stanton expects the company’s balance sheet to benefit in the coming months from a number of factors including higher oil prices, the resolution of issues at the Jubilee field and a full year’s contribution from the Ceiba and Okume fields. (See the analyst's track record here.)
Kosmos’ oil production for fiscal 2018 is projected to rise to approximately 49,000 barrels per day, a 50-percent year-over-year increase.
BP, Kosmos’ partner and operator in the 15Tcf Tortue gas development, recently made positive comments on the operation that Stanton said led him to bring his projections more in line with the companies’ guidance. Investors should watch BP’s second-quarter earnings report on July 31 for more detail, the analyst said.
Investors could see some “overdue” upside from exploration drilling over the next year, Stanton said.
Price Action
Kosmos shares were trading up 4.36 percent at $8.38 at the time of publication Thursday.
Related Links:
July 4 Gas Price Forecast: Highest Average Since 2014
How EVs Are Forcing A Relationship Change Between OEMs, Energy Suppliers, Governments
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
|---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
