TD Newcrest Downgrades Precision Drilling (PDS) to 'Hold' on Price Appreciation
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Price: $91.69 +2.88%
Rating Summary:
11 Buy, 9 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
11 Buy, 9 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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TD Newcrest downgraded Precision Drilling (NYSE: PDS) from Buy to Hold. PT raised from C$12.50 to C$15.
TD analyst says, "Precision shares have nearly doubled in the past six months and are up 47% in the past three months. The market has paid attention to improving fundamentals. As readers can see in the detailed summary at the end of this note, even with what we think are possibly conservative assumptions, we forecast Precision to generate EBITDA of $680 million in 2012 (i.e., our forecast margins are well below those in the good old days of 2006 and 2007). Having said that, despite an increase to our subjective company-specific adjustment to 9/10 (from 6/10) and using an unchanged target EV/EBITDA multiple of 6.5 times (but an 80% weighting) and an unchanged target P/E multiple of 12.0 times (but a 20% weighting), our one-year target price increases to $15.00 (from $12.50), based on higher 2012 estimates. With the modest return to target, we are moving to a
HOLD."
For more ratings news on Precision Drilling click here and for the rating history of Precision Drilling click here.
Shares of Precision Drilling closed at $15.28 yesterday.
TD analyst says, "Precision shares have nearly doubled in the past six months and are up 47% in the past three months. The market has paid attention to improving fundamentals. As readers can see in the detailed summary at the end of this note, even with what we think are possibly conservative assumptions, we forecast Precision to generate EBITDA of $680 million in 2012 (i.e., our forecast margins are well below those in the good old days of 2006 and 2007). Having said that, despite an increase to our subjective company-specific adjustment to 9/10 (from 6/10) and using an unchanged target EV/EBITDA multiple of 6.5 times (but an 80% weighting) and an unchanged target P/E multiple of 12.0 times (but a 20% weighting), our one-year target price increases to $15.00 (from $12.50), based on higher 2012 estimates. With the modest return to target, we are moving to a
HOLD."
For more ratings news on Precision Drilling click here and for the rating history of Precision Drilling click here.
Shares of Precision Drilling closed at $15.28 yesterday.
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