On Monday, Truist Securities revised the price target for Chord Energy Corp (NASDAQ:CHRD), reducing it slightly to $223 from the previous target of $226, while still keeping a Buy rating on the shares. The adjustment by Truist comes after an update to their financial model, which now includes a revised price deck and updated forecasts for the years 2024 through 2026.
The new price target of $223 is based on two equally weighted valuation methods. The first method applies a multiple of 5.0x to the firm's 2025 estimated EBITDAX (Earnings Before Interest, Taxes, Depreciation, Amortization, and Exploration expenses) of $3,093 million, which is higher than the consensus estimate of $2,973 million. This multiple is above the peer average of 4.1x. The second method Truist used involves a Free Cash Flow to Enterprise Value (FCF/EV) Yield assumption of 11.0%.
Chord Energy's stock rating remains at Buy despite the slight reduction in the price target. This indicates that Truist Securities still sees the company as a favorable investment option but has made a modest adjustment to the expected price level.
In other recent news, Chord Energy has been the subject of several analyst assessments and significant corporate developments. Citi resumed coverage on Chord Energy, assigning a Buy rating with a price target of $195.00 per share, based on the company's projected adjusted cash flow of approximately $494.7 million in the second quarter of 2024. This follows Chord Energy's merger with Enerplus (NYSE:ERF), which bolsters its presence in the Bakken shale region.
RBC Capital maintained its Outperform rating and $200.00 price target for Chord Energy, acknowledging the successful completion of the merger with Enerplus. Similarly, Truist Securities reiterated a Buy rating while slightly reducing its price target to $226. Piper Sandler, on the other hand, increased its price target to $233, maintaining an Overweight rating on Chord Energy shares.
Chord Energy's strategic acquisition of Enerplus has been a significant development, and the company's projected earnings per share for 2024 and 2025 stand at $21.92 and $30.16, respectively. Furthermore, cash flow per share is expected to rise, with estimates for the second quarter of 2024 at $10.12, and annual figures reaching $43.41 for 2024 and $54.07 for 2025. These are the recent developments that investors should be aware of.
InvestingPro Insights
Chord Energy Corp (NASDAQ:CHRD) has been the subject of recent financial analysis, and insights from InvestingPro provide additional context for investors. With a market capitalization of $7.22 billion and a compelling price-to-earnings (P/E) ratio of 7.75, Chord Energy presents an interesting value proposition. The company's P/E ratio has remained stable, indicative of consistent valuation by the market. Additionally, Chord Energy's revenue growth of 5.11% over the last twelve months as of Q1 2024 signals steady business expansion.
InvestingPro Tips highlight several key aspects: first, Chord Energy operates with a moderate level of debt, which suggests a balanced approach to leveraging and financial risk. Second, the company's cash flows have been sufficient to cover interest payments, providing comfort regarding its financial health. Moreover, there are more valuable insights available; InvestingPro offers a total of 8 tips for Chord Energy, which can be accessed for a deeper dive into the company's performance and prospects.
Investors interested in a comprehensive analysis of Chord Energy Corp can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, which includes additional InvestingPro Tips. With a fair value estimate of $230.81, according to InvestingPro, the current price target revision by Truist Securities to $223 may still undervalue the company, offering potential upside to investors.
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