Texas Capital Securities Reiterates Buy Rating on Viper Energy (VNOM) Post Sitio Acquisition for $4.1B

Texas Capital Securities analyst Derrick Whitfield reiterated a Buy rating and $49.00 price target on Viper Energy (NASDAQ: VNOM)

The analyst comments "Our take: We view the transaction as a positive for Viper by adding significant scale with high-quality assets at an attractive price. We estimate the transaction was valued at ~$100,750/Permian net royalty acre (adjusted for production), in-line with Viper’s current adjusted EV/acre and expect the +$50mm synergies to further enhance returns over time. In our view, Viper paid market price for Sitio’s Permian position with a free call on non-Permian acreage. With leverage at closing of ~1.2x and enhanced scale, we expect the transaction to create a must-own Minerals company with durable cash flow and a base dividend breakeven below $20/bbl WTI."

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

Shares of Viper Energy closed at $39.97 yesterday.

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