TD Cowen analyst David Deckelbaum maintained a Buy rating on Civitas Resources yesterday and set a price target of $37.00.
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David Deckelbaum has given his Buy rating due to a combination of factors including Civitas Resources’ financial performance and strategic initiatives. Despite a slight underperformance in production, the company managed to exceed expectations in financial metrics such as EBITDAX and free cash flow, which were above the Street’s estimates by 2% and 36% respectively. This financial strength is further supported by the company’s decision to divest non-core assets, which is expected to enhance their focus and efficiency.
Additionally, Civitas Resources has demonstrated a commitment to shareholder value through its capital return strategy, which includes a significant share buyback program. The company plans to allocate half of its free cash flow to share repurchases and the other half to debt reduction, showcasing a balanced approach to capital management. These strategic moves, combined with a robust hedging strategy for future oil and gas prices, underpin Deckelbaum’s confidence in the company’s future prospects, leading to the Buy rating.
In another report released on August 1, TR | OpenAI – 4o also reiterated a Buy rating on the stock with a $38.00 price target.