Citigroup sees small and mid cap E&Ps leading efficiency gains in 2025

Chord Energy

06/12/2024 15:07

** Citigroup says efficiency trends remain favorable for
exploration and production (E&P) companies, while mergers and
acquisitions (M&A) still present value creation potential
    ** Expects small and mid cap (SMID) companies such as
Permian Resources  PR.N  and Chord Energy  CHRD.O  to lead the
E&P industry on efficiency gains in 2025, but the stock impact
could be modest
    ** Adds "we favor PR and CHRD into 2025 given their
opportunities for further operational improvements as they
continue to narrow the gap with their larger-cap peers across
various metrics"
    ** "Challenge for oil E&Ps is that the oil markets look well
supplied in 2025 with downside risk to oil prices" - brokerage
    ** Citigroup sees upside to gas prices in 2025 as the market
will call upon producers to increase investment to meet demand
growth
    Brokerage changes PT on the following firms:
 Company     New PT      Old PT      Upside/dow
                                     nside to
                                     stock's
                                     last close
 EQT Corp    $51         $44         15%
  EQT.N                              
 Expand      $115        $100        19%
 Energy                              
 Corp                                
  EXE.O                              
 Hess Corp   $163        $145        13%
  HES.N                              
 Range       $38         $33         10%
 Resources                           
  RRC.N                              
 
 (Reporting by Pooja Menon in Bengaluru)
 ((Pooja.Menon@thomsonreuters.com;))