Berry Petroleum (BRY) Latest Target in Ultra Hot Energy Space; Who's Next?

February 21, 2013 12:10 PM EST
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Price: $47.25 --0%

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    3 Buy, 11 Hold, 1 Sell

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LINN Energy, LLC (Nasdaq: LINE), LinnCo, LLC (Nasdaq: LNCO) and Berry Petroleum Company (NYSE: BRY) today signed of a definitive merger agreement where LINN and LinnCo will acquire all of Berry's outstanding shares for total consideration of $4.3 billion. This marks the third takeout in the just a few months and is another example of the hot M&A environment in the energy patch.

Commenting on the deal, analyst David Tameron of Wells Fargo speculated about potential competitive bidders, noting that the usual suspects Plains Exploration (NYSE: PXP) and Occidental Petroleum Corporation (NYSE: OXY) are probably reluctant to get involved at this point.

He thinks stocks in the space that could see action on the deal include Whiting Petroleum Corp. (NYSE: WLL), Kodiak Oil & Gas Corp. (NYSE: KOG), Approach Resources, Inc. (Nasaq: AREX), Oasis Petroleum Inc. (NYSE: OAS).

Other companies of interest include Concho Resources, Inc. (NYSE: CXO), Pioneer Natural Resources Co. (NYSE: PXD), Diamondback Energy, Inc. (Nasdaq: FANG), Rosetta Resources, Inc. (Nasdaq: ROSE), and Forest Oil Corporation (NYSE: FST).

"Finally, Range Resources Corporation (NYSE: RRC) and Cabot Oil & Gas Corporation (NYSE: COG) (although both natural gas weighted), always get a bid when M&A news hits," said Tameron.

Wells Fargo has an Outperform rating on Berry Petroleum price target of $64.00 to $68.00.

For an analyst ratings summary and ratings history on Berry Petroleum (NYSE: BRY) click here. For more ratings news on Berry Petroleum click here.

Shares of Berry Petroleum closed at $38.59 yesterday.

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