Why Barclays Is Positive on PDC Energy
Barclays’s top stock picks
In a recent note, investment firm Barclays (BCS) discussed 42 of its top stock picks for the rest of the year that have the potential to provide strong returns. The top five stocks were PDC Energy (PDCE), Goldcorp (GG), Lululemon Athletica (LULU), United Continental Holdings (UAL), and Jazz Pharmaceuticals (JAZZ).
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Barclays on PDC Energy
PDC Energy is an independent oil (USO) (DBO) and natural gas (UNG) exploration and production company. It also operates in gas marketing. According to Barclays, the stock has the potential to rise nearly 79% from its closing price of $44.72 on June 23, 2017. It has provided a price target of $80.
Barclays wrote, “PDC Energy’s stock price has underperformed high growth peers by 13% year-to-date while its relative valuation discount is currently 25%, perhaps prompted by concerns around the resilience of its asset base to lower oil prices.”
The stock has dropped nearly 45% on a year-to-date basis, as of June 27, 2017. In the past year, the stock dropped nearly 26%. Its 52-week high is $84.88, and its 52-week low is $41.11. It is currently trading at $41.12, which is near its 52-week low. The stock provided negative earnings growth both in 2015 and 2016. It’s trading at a price-to-earnings multiple of -17.66x. The Energy Select Sector SPDR ETF (XLE), which tracks the performance of the energy sector, has fallen nearly 14.7% on a year-to-date basis, as of June 27, 2017.
In the next part of this series, we’ll analyze Barclays’ views on Goldcorp.