Analyst Action: Fracking Stocks Catching Wall Street’s Eye

| December 8, 2014 | 0 Comments

Analyst ActionIt’s Monday, and that means it’s time for a look at compelling analyst upgrades and downgrades.

In case you’re unaware, analysts at the biggest banks and investment firms on Wall Street provide research on a multitude of fracking stocks and other natural resource companies. It’s not always the case, but most times a notable bullish change in a respected analyst’s outlook can have a significant influence on a company’s share price.

Of course, their ratings changes aren’t always positive…

When an analyst applies a big downgrade, shares can lose ground quickly.

After all, it’s not a great idea to be fully invested in a company that’s falling out of favor with Wall Street. At the very least, a downgrade can slow buying activity, which opens the door to lower prices.

Either way, it’s important to keep an eye on the analyst activity. Doing so can give you a substantial leg up on the market.

Here are last week’s natural resource company ratings changes that caught my eye… 

Oasis Petroleum (OAS)- The Bakken focused producer was downgraded from “outperform” to “sector perform” at Iberia Capital. While Iberia didn’t provide a price target, analysts at Ladenburg Thalmann think shares should be trading at $28. That’s nearly 100% higher than current prices.

EOG Resources (EOG)- Analysts at JP Morgan raised their price target on the international oil explorer from $99 to $109.  Despite the hefty selloff in the oil and gas industry in recent months, EOG has yet to be downgraded by any Wall Street analyst.

Superior Energy Services (SPN)- The mid-cap international oil services provider was upgraded to “outperform” at Imperial Capital. Analysts have a $28 price target on SPN, which is 45% higher than current prices.

Patterson-UTI Energy (PTEN)- Raymond James upgraded the North American oil services provider from “outperform” to “strong buy”. The firm has a $26 price target on PTEN, which is 60% higher than current prices.

Emerge Energy Services (EMES)- The frack sand supplier was upgraded from “neutral” to “outperform” at Robert W. Baird. While Baird didn’t provide a price target, analysts at Wunderlich and Stifel Nicolaus are targeting $100 and $90 for EMES respectively.

With shares trading at $53 this morning, those targets represent upside of at least 70%.

Rex Energy Corp. (REXX)- BMO Capital Markets upgraded the Marcellus/Utica producer from “market perform” to “outperform”. Analysts see shares rising to $16, which is 160% higher than current prices.

There you have it…

What you see above are the most captivating, and potentially profitable, ratings changes I came across over the past few days. Shares prices may already be reacting to the ratings and price target adjustments.

Now remember…

Just because an analyst has a bullish view on a company doesn’t mean you should dump all your money into the company’s stock. Do your own due diligence and always use correct position sizing and risk control measures in your trades.

If you’d like me to do the work for you, check out the Options Profit Pipeline. This one-of-a-kind options service focuses specifically on commodities and the companies producing them.

Until Next Time,

Justin Bennett

 

BIO: Justin Bennett is the head commodity research analyst at Commoditytradingresearch.com. With over a decade of real world trading experience, he finds ways for you to consistently profit from movements in commodities and the companies producing them. Sign up for our free reports and commodity newsletter at http://commoditytradingresearch.com/free-sign-up.

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Category: Natural Resource Stocks

About the Author ()

Justin Bennett is the editor of Commodity ETF Alert, an investment advisory focused on profiting from the ebb and flow of important commodities via ETFs. The commodity veteran and options specialist is also a regular contributor to the Dynamic Wealth Report. Every week, Justin shares his thoughts with our readers on a variety of commodity-related topics. Justin is also a frequent contributor to Commodity Trading Research’s free daily e-letter. And he’s the editor of another highly successful and popular investment advisory, the Options Profit Pipeline.

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