Wells Fargo downgrades Range Resources to Equal Weight on relative valuation

As previously reported, Wells Fargo downgraded Range Resources (RRC) to Equal Weight from Overweight with a price target of $43, down from $46. The firm notes the target moves lower on PDP M2M. RRC’s low-cost structure, resource depth, and high operational transparency renders an attractive NAV, but those factors have also driven a premium valuation on free cash flow yield, Wells says. The firm further states that the outlook for spring shoulder season natural gas markets has deteriorated with volatility in power burns, higher-than-expected production, and bearish January weather.