Energy Business

4 Big Oil and Gas Stocks Analysts Want You to Buy, but Sell 2 Others

Range Resources Corp. (NYSE: RRC) was raised to Outperform from Market Perform at Raymond James on May 17, which is after news of an acquisition it is making. Range Resources closed down 10% at $37.69 ahead of that call. Jefferies also spoke positively here, reiterating its Buy rating and $45 price target on Range Resources. Jefferies said:

The large equity component is de-leveraging to Range Resources, but looks accretive to CFPS due to improved access to NYMEX pricing. Weak local pricing and incremental NE evacuation capacity likely played a role in Range Resource’s desire to diversify.

Range Resources ended up closing at $40.38 on Friday. It has a consensus analyst price target of $44.09, 2% higher than the prior week, and it has a 52-week range of $19.21 to $59.88.

Tesoro Corp. (NYSE: TSO) was started with a Buy rating and was assigned a $100 price target at UBS on May 19. This was versus a prior closing bell price of $79.48, and Tesoro closed out the week at $79.09. Tesoro has a consensus analyst price target of $106.04 and has a 52-week range of $67.80 to $119.67.

Stocks Analysts Say to Sell

Marathon Petroleum Corp. (NYSE: MPC) was started with a Sell rating and was given a $34 price target at UBS on May 19. This call was versus a prior $36.74 closing price, and Marathon closed out the week at $36.63. Marathon has a consensus analyst price target of $50.94 and has a 52-week range of $29.24 to $60.38. Its market cap is still %19.9 billion.

Petroleo Brasileiro S.A. (NYSE: PBR), or Petrobras, was seen down this last week, dropping to $6.45 from the prior week’s close of $6.88. It was actually up at $7.15 at the start of the week, but you know they just can’t keep things straight down in Brazil these days. A new CEO announcement will help, but the heat remains on the nation.

The big analyst call came from Raymond James. This firm thinks that Petrobras should be avoided now, and they downgraded the official rating to Underperform from Market Perform. The firm thinks it is a pipe dream investors are buying now, and the 56% gain has not been on the fundamentals here. They fear about the $100+ billion in debt, which will make the debt hinder its ability to operate normally, even though Petrobras cannot operate normally as a state-run entity.

Elsewhere, Petrobras was maintained as Neutral at Merrill Lynch with a $7.50 price objective. Despite EBITDA being helped by better refining results and despite the potential sale of pipelines being near, the firm thinks that Petrobras’ underlying risks remain high.

Petrobras has a consensus analyst price target of $4.88 and has a 52-week range of $2.71 to $10.46.

Here is the prior week’s oil and gas feature from analysts: the seven oil and gas stocks analysts said to buy for the week ending on May 13.