Global Hunter Securities Upgrades PetroQuest (PQ) to Buy Post-Q3

November 8, 2012 9:10 AM EST Send to a Friend
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Price: $5.94 -0.34%

Rating Summary:
    5 Buy, 6 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 16 | Down: 14 | New: 38
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Global Hunter Securities upgraded PetroQuest (NYSE: PQ) from Accumulate to Buy with a price target of $7.00 (from $8.00).

The firm comments, "Despite reducing our price target to $7 (from $8), we are upgrading our rating on shares of PetroQuest (PQ) to Buy from Accumulate, reflective of what we believe to be an attractive risk/reward proposition after yesterday's precipitous downward move. While PQ's management increased planned 2012 capex by $20MM to a range of $130MM to $135MM, it did so to reflect an asset sale that is unlikely to close by year end, not in order to spend more money in Q4:12. Our capex estimate has been in the $146MM range. Operationally, production of 15.4 Mboepd exceeded our 14.8 Mboepd Q3:12 estimate, but much lower than expected natural gas price realizations of $2.26/mcf caused negative EPS/CFPS comparisons of ($0.03)/$0.25 vs. $0.02/$0.27. Excluding a $35.4MM non-cash ceiling-test writedown related to those aforementioned low natural gas prices, expenses were in line with expectations. While our 2013 production estimates scale up slightly in response to timing at La Cantera, additional upside potential exists related to three other South Louisiana and Gulf of Mexico wells PQ likely will spud in 2013: Thunder Bayou, Sawgrass, and Overlake, which is an oil project. "

For an analyst ratings summary and ratings history on PetroQuest click here. For more ratings news on PetroQuest click here.

Shares of PetroQuest closed at $5.03 yesterday.




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