Plains Exploration & Production (NYSE:PXP) was downgraded by FBR Capital from
"Outperform" to "Market Perform."
"Assuming current MMR stock price (our $4.50/Mcf long-term gas price assumption implies about 6 Tcfe gross deep shelf potential priced in) and a generous $2 billion in proceeds from deepwater asset sales, the remaining assets are currently valued at 4.7 times 2011 TEV multiple and 70% of 3P NAV. We note that comparable peer group trades at 5.5x and 55% of 3P NAV. We would like to see an actual price tag for the deepwater assets, continued deep shelf exploratory and development success, and execution on the remaining assets before we revisit our rating," said FBR.
Plains closed at $26.49 Tuesday, falling $1.23, or 4.44 percent. FBR has a price target of $30 on Plains.
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