GREY:LSTMF - Post by User
Post by
blondeBondon Nov 22, 2013 3:58pm
369 Views
Post# 21933228
from TD Securities
from TD Securities In our view, Lightstream has a solid suite of high-netback, light oil opportunities, but diminishing liquidity continues to have a negative impact on corporate returns. We appreciate the strategic move to improve the company’s financial flexibility on a longer-term basis, but will closely monitor the execution of the strategy through 2014, largely focused on capital spending trends and production volumes.
Since downgrading Lightstream on August 8, the stock is off 27%.
Based on valuation and price depreciation, we are upgrading Lightstream to BUY from Hold but maintain our $7.50 target price.
Today, Lightstream is trading at a 2014 EV/DACF of 4.4x, which is a steep discount to its dividend focused peers (average of 7.4x) and historical three-year level of 5.5x.