Cardinal Energy Initiated With Neutral Rating, $10 Price Target at CIBC, from 1 hour ago by MT Newswires
1 hour ago by MT Newswires
07:56 AM EDT, 06/28/2022 (MT Newswires) -- Cardinal Energy Ltd. (CJ.TO) was started at Neutral with a $10 price target in new coverage at CIBC Capital Markets.
Analyst Chris Thompson said the Calgary-based oil and gas company has a low-decline-rate operating model that generates impressive free cash flow, and a leading dividend yield.
"That being said, when stress tested at lower commodity prices, we see relatively higher risk in the model because of the company's higher relative cash costs," Thompson said in a note to clients.
"While we believe a valuation premium relative to peers is warranted given Cardinal's leading capital intensity ratio, with the stock trading at 3.5x 2023E EV/DACF on our price deck versus a peer average of 2.7x, we would wait for a smaller gap," the analyst said.
(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)