-- CIBC Capital Markets maintained its neutral rating on the shares of PrairieSky Royalty (PSK.TO) while adjusting its price target to $32.75 per share from $31.75 following the company's first-quarter results.
Analyst Jamie Kubik said the Western Canadian oil and gas royalty company reported first-quarter 2026 cash flow per share above consensus, driven by strong bonus consideration during the quarter. This offset lower-than-expected oil production, which declined slightly from Q4 2025 and marked the third consecutive quarterly drop in oil volumes.
Drilling activity on the company's Duvernay lands reached its highest level to date, which is expected to support oil volumes inflecting higher starting in Q2, the analysts said, adding that their 2026 estimated cash flow per share is largely unchanged, but valuation expectations were raised slightly due to strong bonus activity that could support additional industry drilling.
"We continue to like the organic growth profile of PrairieSky due to leasing activity in key oil and gas plays of the WCSB. Our current price target drives more limited upside in the shares than our other Outperformer-rated stocks; therefore, we maintain a Neutral rating at the current time," Kubik said.