Scotia Capital has dropped its stock price targets for a handful of energy companies after revising its outlook for oil and natural gas.
For natural gas, the investment firm has decreased its 2015 and 2016 forecasts to US$3/mcf and US$3.50 mcf respectively, both from US$4/mcf.
Scotia has also lowered its 2015 WTI forecast for oil to US$50 per barrel from US$75. The 2016 and 2017 forecasts have been revised to US$83 per barrel and US$88 per barrel to US$60 and US$70.
In keeping with the investment firm’s outlook for oil and gas, Scotia Capital analyst Patrick Bryden has slashed his stock price target on
Northern Blizzard Resources Inc. (
TSX: T.NBZ,
Stock Forum) to $9.50 from $20.
He has also changed his rating on the stock to Sector Perform from Sector Outperform. “In our view the current macro environment and outlook for heavy oil in particular will present challenges for reinvestment efficiencies and cash flow growth,’’ he said.
Trading at $7.79 on Monday, Northern Blizzard has a market cap of $805.4 million, based on 103.4 million shares outstanding. The 52-week range is $19 and $6.97.
For similar reasons, Bryden has also dropped his target for
Perpetual Energy Inc. (
TSX: T.PMT,
Stock Forum) to $1 from $1.55.
“While we commend management on its recent steps to help improve the financial position of the company, we have opted to downgrade the company from Sector Perform to Sector Underperform,’’ Bryden said.
“In our view, the current macro environment puts significant pressure on the company’s balance, and as such, we believe there are more financially stable options for investors within our coverage space.’’
Scotia analyst William Lee has dropped his price target for
Legacy Oil + Gas Inc. (
TSX: T.LEG,
Stock Forum) to $2.50 from $4.50.
“With our 2015 deck moving to US$50 per barrel WTI and US$3/Mcf Henry Hub (which we view as reasonable relative to current strip prices), we think that Legacy will likely need to trim its outlook for the year,’’ Lee said.
Still, Legacy Oil shares rose 14% to $1.75 Monday, leaving a market cap of $349.5 million, based on 199.7 million shares outstanding.
The 52-week range is $10.03 and $1.17.