MEG Energy Downgraded to Market Perform at Raymond James
11:15 AM EST, 11/14/2022 (MT Newswires) -- MEG Energy Corp. (MEG.TO) was downgraded to Market Perform from Outperform at Raymond James.
Analyst Michael Shaw maintained a price target of $22 on shares of the Calgary-based oil sands producer.
"MEG is facing a number of headwinds going into 2023," Shaw said in a note to clients. "Top among them is the persistently high differential on heavy sour barrels in both the USGC and Western Canada."
"While we agree with MEG's assessment that the abnormal heavy differentials will not last forever, it is difficult to assess when the US SPR releases or the impact of heavy Russian barrels trying to find a home will end," the analyst said.
"...MEG remains one of the best ways to play Western Canadian heavy oil prices," Shaw said. "Its long-lived, low decline, and low sustaining capex project make it an attractive investment over the long-term. As a tactical measure, we are lowering our rating to Market Perform to reflect current headwinds and relative valuation."
(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)
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