On Dec 26, Zacks Investment Research upgraded Radnor, PA-based
oil and gas explorer
Penn Virginia Corp.
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
We remain optimistic about the firm's near-term prospects,
supported by its high-quality Eagle Ford Shale holdings,
impressive oil production growth and continued strong operating
performance led by an efficient management team.
A turnaround story, Penn Virginia has re-designed its asset
portfolio by making an active push into liquids (from gas) to
grow its production and reserves.
Concerned by the volatility in gas prices, Penn Virginia's
capital program - since 2010 - specifically focuses on the
promising liquids-rich Eagle Ford region in a major shift away
from dry natural gas development. The company's strategy
realignment has led to a highly visible production-growth
The recently concluded acquisition of sizeable producing and
undeveloped acreage in the burgeoning Eagle Ford shale formation
in South Texas from
Magnum Hunter Resources Corp.
) will offer Penn Virginia a meaningful production growth
opportunity in the high-margin North American unconventional
resource plays and further drive its overall volumes.
Another positive in the Penn Virginia story is its progress
towards well cost reduction. The company has been able to cut
down on completion and drilling expenditure on increased
efficiencies. Finally, Penn Virginia maintains a stable balance
sheet that will continue to provide the flexibility to fund its
capital program and pursue bolt-on acquisitions.
Other Stocks to Consider
Some other stocks worth considering in the domestic upstream
Harvest Natural Resources Inc.
Cabot Oil & Gas Corp.
). While Harvest holds a Zacks Rank #1 (Strong Buy), Cabot
carries a Zacks Rank #2 (Buy).
CABOT OIL & GAS (COG): Free Stock Analysis
HARVEST NATURAL (HNR): Free Stock Analysis
MAGNUM HUNTER (MHR): Free Stock Analysis
PENN VIRGINIA (PVA): Free Stock Analysis
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