Wall Street analysts’ ratings of Southwestern Energy
Currently, ~19% of Wall Street analysts rate Southwestern Energy (SWN) a “buy,” and ~55% of analysts rate it a “hold”. Around 26% rate the stock a “sell.” The median target price from these recommendations is $8.92, which is ~16% lower than the closing price of $10.67 on April 21, 2016.
Based on the median target prices from Wall Street analysts, upstream companies Memorial Resource Development (MRD), Energen Corporation (EGN), and Diamondback Energy (FANG) have potential upsides of ~31%, ~3%, and ~6%, respectively, from their closing prices on April 21. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) generally invests at least 80% of its total assets in oil and gas exploration companies, whereas the First Trust ISE-Revere Natural Gas Index Fund (FCG) invests in natural gas producers.
SWN’s individual recommendations
The above table shows Wall Street analysts’ forecasts for SWN after 1Q16 earnings. The most recent recommendation of “neutral” came from Robert W. Baird & Co. on April 22, 2016. Robert W. Baird & Co. assigned Southwestern Energy a target price of $6, which is ~44% lower than the closing price of $10.67 on April 21. Robert W. Baird & Co. expects SWN to reach the target price within the next 12 months.
Tudor, Pickering, Holt & Co. assigned SWN the highest target price of $18, which is ~69% higher than the closing price on April 21. Tudor, Pickering, Holt & Co. issued its recommendation on April 21 and expects the stock to reach the target price within the next 12 months.
Some of the positives for SWN’s stock as noted by Wall Street analysts are better production growth, a focus on cost reduction, and meaningful upside potential if natural gas prices recover.