Post by
retiredcf on Sep 08, 2023 7:49am
Stifel Raise Target
Calling its deal to acquire CWC Energy Services for consideration of $140-million “another positive market endorsement of industry consolidation,” Stifel’s Cole Pereira increased his Precision Drilling Corp. target to $135 from $130 with a “buy” rating. The average is $128.31.
“We believe the transaction occurred at 2.3 times EV/EBITDAS after synergies, accretive to PD’s prior multiple of 3.3 times 2024E EV/EBITDAS, while 2024E CFPS and FCFPS both increase 1 per cent, with further upside upon full synergy realization,” he said. “The transaction would increase PD’s market share of the Canadian well servicing market to 24 per cent from 15 per cent, while giving it additional optionality through 18 drilling rigs focused on the Cardium and Wyoming. Our EBITDAS forecast is unchanged in 2023 ($662-million) but increases 7 per cent in 2024 ($730-million).”
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