Deutsche Bank Upgrades Basic Energy Services (BAS) to Buy

Deutsche Bank upgraded Basic Energy Services (NYSE: BAS) from Hold to Buy with a price target of $45.

Analyst Mike Urban said, "Basic has emerged from Chapter 11 with a sustainable cost structure and a significantly improved balance sheet. After falling for two straight years, we forecast customer spending will tick up in 2017 and think early spending will focus on production given the low risk, quick cash conversion and small capital outlay associated with the spend. Basic’s completion and production exposure will allow them to be an early cycle beneficiary. Our Q4 and 2016 estimates fall to ($1.55) and ($6.17) from ($1.16) and ($5.77), respectively, to reflect a reduced share count post restructuring. Our 2017 and 2018 estimates improve to ($3.33) and ($1.15) from ($3.86) and ($2.65), respectively, as the reduced share count is more than offset by our improved demand outlook and a reduced interest expense from the restructuring. Our improved outlook for the operating environment coupled with a strengthened balance sheet post restructuring causes us to upgrade BAS to BUY from HOLD."

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

Shares of Basic Energy Services closed at $38.89 yesterday.

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