UPDATE: Topeka Capital Markets Upgrades SM Energy Company Following Great 3Q13 Results

In a report published Wednesday, Topeka Capital Markets analyst Gabriele Sorbara upgraded the rating on SM Energy Company (NYSE: SM) from Hold to Buy, and raised the price target from $80.00 to $120.00.

In the report, Topeka Capital Markets noted, “We are upgrading SM to Buy from Hold and raising our price target to $120 from $80, following excellent 3Q13 results and with the unveiling of ~53,500 net core Permian acres in southwestern Dawson and southeastern Gaines counties (leased or committed). This newly disclosed position, along with its ~19,000 net legacy acres in Upton County present more than $52 of NAV upside, based on our calculation, when ascribing 35% credit across seven potential horizontal targets. While SM has done a great job in the Eagle Ford and Bakken, we believe this Permian position opens the next chapter to the story, with a significant potential inventory of high IRR projects.”

SM Energy Company closed on Tuesday at $87.47.