KeyBanc Reiterates Overweight Rating on Diversified Energy Co. (DEC)

KeyBanc analyst Tim Rezvan reiterated an Overweight rating and $17.00 price target on Diversified Energy Co. (NYSE: DEC).

The analyst commented: "Meeting Provides Insight on Carlyle Deal, Cherokee JDA, and Asset Sales; We attended a dinner and field trip with management in Oklahoma City this week. The event was timely, one day after Diversified's news of an ABS funding agreement of up to $2B with the structured credit group of Carlyle. We received incremental details, such as the focus on larger scale deals ($250M or larger) and the structure of the financing arrangement, with Carlyle owning a residual equity interest in the ABS. We learned about the MidCon Joint Development Agreement (JDA) with Mewbourne. Management highlighted the attractive drilling economics of the Cherokee Shale – EURs of 1.3 mmboe (50% oil) and AFEs averaging $515/ft. The uptick in industry interest in the MidCon area bodes well for Diversified and the large leasehold position it owns in Oklahoma, which we believe makes the recent cadence of $30M/year of asset sales reasonable, if not conservative, as a go-forward target. We reiterate our OW rating and $17 price target following the trip."

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

Shares of Diversified Energy Co. closed at $14.77 yesterday.

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