BMO Initiate Coverage I just opened a small position. GLTA
Seeing its Mannville holdings driving “outsized growth,” BMO’s Mike Murphy initiated coverage of Lycos Energy Inc. with an “outperform” rating and $5.50 target. The average is $7.35.
“As the only public company with pure play exposure to the emerging Mannville multilateral heavy oil play, we view Lycos as well-positioned to deliver a 50-per-cent CAGR [compound annual growth rate] on production over the next three years at top tier capital efficiencies,” said Mr. Murphy. “Primarily utilizing innovative ‘fishbone’ multi-lateral drilling techniques, reservoir contact is maximized with as many as 30 legs per well, at a cost of only $1.6 million. LCX trades at 1.7 times 2024 estimated EV/EBITDA (BMO Deck) relative to peers at 2.2 times.”