Wednesday, October 20, 2010

Wells Fargo (NYSE:WFC) Downgrades Oasis Petroleum (NYSE:OAS) Citing Valuation

With its strong performance since its summer IPO, Oasis Petroleum (NYSE:OAS) is looked upon as fully valued, and Wells Fargo (NYSE:WFC) was the latest to downgrade them, as the dropped them from "Outperform" to "Market Perform."

Wells said, "We are downgrading shares of OAS following substantial absolute and relative strength. With shares up 55% from the IPO, they have handily outperformed the EPX during that timeframe. With Bakken upside potential increasingly understood, execution a requisite, and oil trading toward the higher end of its recent range, we view risk reward as more consistent with a Market Perform rating. We are maintaining our estimates and valuation at this time."

UBS (NYSE:UBS) downgraded them Monday from "Buy" to "Neutral," citing similar reasons.

Oasis closed Tuesday at $20.26, losing $1.40, or 6.46 percent.

Wells has a valuation range of $21.00 to $23.00 on them.

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