California Resources Corp. (NYSE: CRC) has sold off far too much, according to Bank of America Merrill Lynch. The firm thinks that this short seller attack has gone too far, that short sellers are misunderstanding the California Resources story and that the research partly behind the short attack simply may be wrong. Here is what really stands out: the $15.00 fair value price objective.
With a recent California Resources share price of $5.26, that implies almost 200% upside. Sure, the call is the most aggressive of all on Wall Street, but Merrill Lynch does not make huge calls like this very often.
Azure Midstream Partners L.P. (NYSE: AZUR) was reiterated as Buy at Janney Capital Markets, but the firm named it a new top pick in the call. On top of raising the fair value target to $30 from $29, this represents more than 100% implied upside to Azure’s current price. How many master limited partnerships (MLPs) get called on to double in price?
Janney thinks that substantial dividend increases should push Azure higher, and the recent share issuance was said to have “derisked the growth story” along with cost savings. At $13.21, Azure has a 52-week range of $10.62 to $24.18 and a consensus analyst price target of $27.40.
Other key analyst upgrades in the oil and gas sector from this past week were seen as well, though these certainly are not all of the upgrades and positive calls:
Anadarko Petroleum Corp. (NYSE: APC) was raised to Buy from Hold at Jefferies.
Cameron International Corp. (NYSE: CAM) was raised to Outperform from Sector Perform with a price target of $65 (versus a $50.38 close) at RBC Capital Markets on Friday.
Columbia Pipeline Group Inc. (NYSE: CPGX) was started as Buy with a target price of $33 (versus a $30.34 close) at UBS.
EnLink Midstream Partners L.P. (NYSE: ENLK) was started as Buy with a target price of $27 (versus a $22.25 close) at UBS.
NiSource Inc. (NYSE: NI) was raised to Overweight from Equal Weight at JPMorgan, and the $20 price target was maintained (versus a $17.14 close).
Statoil ASA (NYSE: STO) was raised to Outperform from Neutral at BNP Paribas.
Also, Credit Suisse named three top MLP picks that should do well in a period of rising interest rates. Recent insider buying was highlighted by purchases in Devon Energy and Energy Transfer Partners. And despite lower oil prices, it looks as though the uptick in the oil and gas rig counts has continued.