Wunderlich Securities Maintains Rating, PT On PETD

Wunderlich Securities, highlighting strong results but weak gas prices, is maintaining its Buy rating and $52 price target on PDC Energy (NASDAQ: PETD).

Says Wunderlich, in the report, “PDC Energy (PETD) reported first quarter results with “clean” EPS of ($0.12), and cash flow per share of $1.11, below consensus in both cases. While production of 11 bcfe was strong, lighter hedging gains and lower-than-expected realized gas price in the Rockies negatively impacted the company's bottom line. PDC markets its Rocky gas through a third party and sale prices have been $0.40/mcfe lower than expected. For the near term, we hope to see the gas marketing issues resolved. In the longer run, we believe that PDC's oilier projects in the DJ Basin Niobrara Play could tilt the company's revenue mix toward oil and liquids and dampen the impact of Rocky gas. We reiterate our Buy rating.”

PETD closed at $36.69 yesterday.