UPDATE: JPMorgan Downgrades EOG Resources (EOG) to Neutral

July 23, 2020 5:25 AM EDT
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Price: $84.86 -0.68%

Rating Summary:
    36 Buy, 17 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 11 | Down: 12 | New: 42
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(Updated - July 23, 2020 5:26 AM EDT)

(updating comment)

JPMorgan analyst Arun Jayaram downgraded EOG Resources (NYSE: EOG) from Overweight to Neutral with a price target of $56.00 (from $62.00).

The analyst comments "We continue to view EOG as a long-term core holding in the space given its premium drilling strategy that is poised to support differentiated returns on capital assuming mid-cycle pricing, but are more cautious on the shares near-term given the potential risk associated with the company's leverage to federal acreage in the New Mexico Delaware and Powder River Basin. We estimate that 50% of EOG’s Delaware Basin and 33% of the company’s PRB locations are located on federal lands. While EOG does have a significant amount of approved permits in hand in both plays and the ability to pivot to other premium plays in its portfolio, we do note that the company derives approximately ~43% of its oil volumes from the Delaware and Powder River Basin plays. In addition, ~29% of our NAV is derived from undeveloped resources in both plays. We are reducing our Dec-20 price target to $56 from $62, which assumes 90% our updated NAV given perceived regulatory risk on federal acreage."

For an analyst ratings summary and ratings history on EOG Resources click here. For more ratings news on EOG Resources click here.

Shares of EOG Resources closed at $50.19 yesterday.


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