Global Hunter Securities Downgrades Kodiak Oil & Gas (KOG) to Neutral; If You Build It, They Will Come...But At What Price?
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Price: $8.82 +4.63%
Rating Summary:
10 Buy, 9 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 35 | New: 23
Rating Summary:
10 Buy, 9 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 35 | New: 23
Trade KOG Now!
Global Hunter Securities downgraded Kodiak Oil & Gas (NYSE: KOG) from Buy to Neutral with a price target of $7.50.
Global analyst says, "KOG announced 3Q11 operating results with production coming in 15% below what we previously thought were conservative estimates. Kodiak has done a good job of acquiring top tier acreage targeting the Bakken Shale, however, operational results have typically lagged expectations. The company reaffirmed its 2011 exit rate of 9,000 Boepd, not including the recent 3,000 Boepd acquisition. Still, we are keeping our estimates conservative. This recent acquisition has exhausted the company's cash stockpile, and we believe an additional $150MM of equity will be needed in the short term in order to maintain the current level of capex, including five drilling rigs. At the same time, we have seen M&A pick up in the Bakken with the announcement that Brigham Exploration (Nasdaq: BEXP) is being acquired. This has vaulted KOG's stock price by more than $1.00 (+20%) in the past few days. While a take-out scenario could warrant a $6+ per share valuation, we are a bit more cautious as we think Kodiak will focus on operations."
For more ratings news on Kodiak Oil & Gas click here and for the rating history of Kodiak Oil & Gas click here.
Shares of Kodiak Oil & Gas closed at $6.18 yesterday, with a 52 week range of $3.58-$7.70.
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Global analyst says, "KOG announced 3Q11 operating results with production coming in 15% below what we previously thought were conservative estimates. Kodiak has done a good job of acquiring top tier acreage targeting the Bakken Shale, however, operational results have typically lagged expectations. The company reaffirmed its 2011 exit rate of 9,000 Boepd, not including the recent 3,000 Boepd acquisition. Still, we are keeping our estimates conservative. This recent acquisition has exhausted the company's cash stockpile, and we believe an additional $150MM of equity will be needed in the short term in order to maintain the current level of capex, including five drilling rigs. At the same time, we have seen M&A pick up in the Bakken with the announcement that Brigham Exploration (Nasdaq: BEXP) is being acquired. This has vaulted KOG's stock price by more than $1.00 (+20%) in the past few days. While a take-out scenario could warrant a $6+ per share valuation, we are a bit more cautious as we think Kodiak will focus on operations."
For more ratings news on Kodiak Oil & Gas click here and for the rating history of Kodiak Oil & Gas click here.
Shares of Kodiak Oil & Gas closed at $6.18 yesterday, with a 52 week range of $3.58-$7.70.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
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