Cowen analyst David Deckelbaum reiterated an Outperform rating and $160.00 price target on Pioneer Natural Resources (NYSE: PXD) highlighting the company as his Top E&P Pick for 2021 on the belief that the company should deliver a superior return of capital to shareholders while remaining under-levered and achieving differentiated modest production growth.

The analyst stated "PXD differentiates through an ability to deliver production growth of 5% on avg through 2025,all with the capacity to payout a combination of a fixed + variable dividend of 5% on average at strip, using just 50% of excess FCF. We see this setup as a winning combination that will be better appreciated once the PE deal (announced in October) is further digested to leverage 1) PXD's superior balance sheet and cheaper cost of capital that should aid in early 2021 refi's and 2) lower cost access to frac water via unique Midland contracts."

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Shares of Pioneer Natural Resources closed at $118.00 yesterday.