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Capital One Southcoast Lowers Natural Gas Price Deck at Energy Conference; Downgrades ATLS & ATPG

September 9, 2009 9:54 AM EDT
ATLS Hot Sheet
Rating Summary:
    0 Buy, 5 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 16 | Down: 7 | New: 23
Capital One Southcoast downgrades Atlas America (Nasdaq: ATLS) and ATP Oil & Gas Corp. (Nasdaq: ATPG) from Buy to Neutral.

Capital One analyst says, "We are lowering our 2009 natural gas price deck from $4.50 to $4/Mcf by lowering 3Q to $3.50 and 4Q to $4. We are lowering 2010 prices from $6.50 to $5 and keeping our long-term price deck at $6.50. We are lowering our price deck based on the most recent 914 data, which showed June US onshore production only declining 0.3% from May versus expectations of 0.5% - 0.8% declines. With lower production declines than expected, we think natural gas prices will take longer to recover to our long-term price deck of $6.50. As a result of the lower price deck, our average target price declines by ~5% and we are downgrading ATLS and ATPG to NEUTRAL."

Capital One analyst also raises price target on CGG VERITAS (NYSE: CGV) from $16 to $27, but maintains a Neutral rating.

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