Wells Fargo Starts SandRidge Permian Trust (PER) at Market Perform; Liquids Exposure With Less Volatility

Wells Fargo initiates coverage on SandRidge Permian Trust (NYSE: PER) with a Market Perform. PT $21.00.

Wells analyst says, "The SandRidge Permian Trust represents the second royalty trust sponsored by SandRidge in 2011, and the structure is nearly identical to the Mississippian Trust I. PER provides investors with exposure to low risk oil weighted assets, near-term commodity price protection, and increasing distributions over the drilling period. However, at current levels, units are fairly valued according to our discounted cash flow model. Our valuation range is $18.00-21.00 per unit based on our discounted cash flow model which implies a per unit value of $18.18. Our EPU estimate for 2011 is $1.16 and our 2012 EPU estimate is $2.46."

For more ratings news on SandRidge Permian Trust click here and for the rating history of SandRidge Permian Trust click here.

Shares of SandRidge Permian Trust closed at $19.25 yesterday.

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