Canaccord Downgrades Oasis Petroleum Inc. (OAS) To Hold; Sees No Sufficient Upside
In a research report released Thursday, Canaccord Genuity analyst Stephen Berman downgraded shares of Oasis Petroleum Inc. (NYSE:OAS) from Buy to Hold and reduced the price target from $17 to $15, which implies an upside of 7% from current levels.
Berman explained, “With over 500K net acres (86% held by production), almost all of which are operated, OAS is one of the largest players in the Williston Basin (WB). The company has a large inventory of Bakken and Three Forks locations in many of the best areas of the WB. That said, given the dilution from the equity offering that knocks down our NAV and PT, we no longer feel there is sufficient upside in the stock to warrant a Buy rating, and are therefore downgrading OAS to HOLD.”
Furthermore, “Our $15 price target is based on a 20% discount to an $18.70 NAV. Our prior $17 target reflected the same discount to a ~$21.25 NAV. The reduction in NAV is due solely to the dilutive effect of the equity offering.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Stephen Berman has a total average return of -14.0% and a 35.7% success rate. Berman has a -28.9% average return when recommending OAS, and is ranked #3479 out of 3505 analysts.