BMOBMO Nesbitt Burns analyst Jeremy McCrea reinstated coverage of a group of Canadian energy companies on Tuesday: Kelt Exploration Ltd. with an “outperform” rating and $8.50 target. Average: $8.18.
Analyst: “Kelt is a well-capitalized company with significant land acreage focused in the Montney and Charlie Lake plays. As Kelt takes much of its exploration learnings and applies these concepts in a much more aggressive development plan, the company should see top quartile growth over the next couple of years. As investors gain comfort in the quality and duration of this inventory (especially in Oak), a higher multiple premium should be rewarding for shareholders, especially as this growth comes to fruition.”
* Logan Energy Corp. (LGN-X) with an “outperform” rating and $1.25 target. Average: $1.50.
Analyst: “Over the past decade, there have only been a few management teams that can point to a track record of M&A success and a capacity to generate meaningful shareholder value. With insiders owning 21 per cent and a goal of growing production more than 50 per cent per year via M&A for the next few years, there is considerable alignment for growth-oriented investors. In the meantime, the company has a good starting package with 500+ Montney locations. If Logan can execute and successfully showcase well results utilizing modern completion technology, we think there is meaningful upside.”