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March 9, 2020, 8:07 a.m. EDT

More than two dozen energy production companies downgraded at Stifel, SunTrust as oil price war looms

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By Tonya Garcia

Two research analyst houses, SunTrust Robinson Humphrey and now Stifel, have lowered the stock ratings and price targets for more than two dozen energy companies as an oil price war looms. Stifel analysts downgraded a dozen exploration and production (E&P) companies on Monday as Russia's refusal to join the OPEC production proposal drives fears of an impending oil price war. Saudi Arabia has cut oil prices to customers across Asia, the U.S. and Europe by $6-to-$8 per barrel. "While the move could drive Russia back to the table to forge an agreement, it appears Vladimir Putin would like to see the U.S. market share of global supply reduced significantly," Stifel analysts wrote. "This coupled with an uncertain demand outlook could cause our group to discount much lower oil prices than our long-term forecast ($55 WTI, $60 Brent)." Goldman Sachs analysts warn that crude prices could drop to $20 per barrel as the oil price threat is coupled with the turmoil caused by coronavirus outbreak. Among the downgrades were Apache Corp. /zigman2/quotes/200648444/composite APA -0.13% , down to hold from buy at Stifel, price target cut to $15 from $37; Viper Energy Partners L.P. /zigman2/quotes/206725468/composite VNOM +3.85% , down to hold from buy at SunTrust, price target slashed to $18 from $36; and Cimarex Energy Co. /zigman2/quotes/205517948/composite XEC +1.61% downgraded to hold from buy at Stifel, price target reduced to $18 from $106. "We spoke to several executives over the weekend who suggested all U.S. E&Ps could be in for a bleak period if the price war and Covid-19 impact last more than a quarter," SunTrust analysts said. Dow Futures are down more than 1,300 points in Monday premarket trading. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.91% has lost 9.4% for the year to date.

/zigman2/quotes/200648444/composite
US : U.S.: Nasdaq
$ 15.57
-0.02 -0.13%
Volume: 3.64M
Aug. 12, 2020 12:22p
P/E Ratio
N/A
Dividend Yield
0.64%
Market Cap
$5.88 billion
Rev. per Employee
$2.15M
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/zigman2/quotes/206725468/composite
US : U.S.: Nasdaq
$ 11.34
+0.42 +3.85%
Volume: 187,829
Aug. 12, 2020 12:20p
P/E Ratio
N/A
Dividend Yield
1.06%
Market Cap
$1.74 billion
Rev. per Employee
N/A
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/zigman2/quotes/205517948/composite
US : U.S.: NYSE
$ 28.95
+0.46 +1.61%
Volume: 459,312
Aug. 12, 2020 12:22p
P/E Ratio
N/A
Dividend Yield
3.05%
Market Cap
$2.91 billion
Rev. per Employee
$2.45M
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/zigman2/quotes/210598065/realtime
US : Dow Jones Global
27,937.81
+250.90 +0.91%
Volume: 154.70M
Aug. 12, 2020 12:22p
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