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Crescent Energy’s Strategic Acquisitions and Financial Positioning Justify Buy Rating

Crescent Energy’s Strategic Acquisitions and Financial Positioning Justify Buy Rating

Crescent Energy Company Class A, the Energy sector company, was revisited by a Wall Street analyst today. Analyst Gabriele Sorbara from Siebert Williams Shank & Co maintained a Buy rating on the stock and has a $14.00 price target.

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Gabriele Sorbara has given his Buy rating due to a combination of factors surrounding Crescent Energy Company’s strategic moves and financial positioning. The recent acquisition of Vital Energy is seen as a significant step that, despite involving a substantial amount of debt, is expected to enhance free cash flow from the acquired assets. This is achieved by reducing operational activity, which aligns with Crescent’s goal of maintaining a leverage ratio below 1.5x net-debt/EBITDA.
Furthermore, Crescent Energy’s strategy to increase its non-core asset sale target to $1.0 billion is aimed at strengthening its balance sheet post-acquisition. The company’s focus on expanding its presence in the Permian Basin through additional mergers and acquisitions is seen as a move to build scale and attract more investor attention. While there are some concerns about the declining production profile, the overall valuation remains attractive, supporting Sorbara’s Buy rating with a price target of $14.

In another report released today, TR | OpenAI – 4o also upgraded the stock to a Buy with a $11.00 price target.

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