Wunderlich Reiterates Buy on Oasis Petroleum (OAS)

Wunderlich is out with its report today on Oasis Petroleum (NYSE: OAS), reiterating Buy.

In a note to clients, Wunderlich writes, "Oasis Petroleum has planned to spend $490mm in 2011. The company had planned to run seven rigs and drill 69 gross and 53.1 net (operated and non-operated) wells. OAS reiterated full-year production guidance but expects capex to increase to $550mm; this is dependent on the arrival of new frac crew and drilling rigs. We believe that this potential spending increase can be attributed to more frac stages per well, one more frac crew, possibly two more rigs toward year-end, and cost escalation (pressure pumping). We believe that the OAS team will continue to maximize efficiency gain and fight cost escalation. We reiterate our Buy rating and our target of $39.00 on OAS."

Shares of OAS closed Thursday at $26.65.