Permian Resources (PR) remains well positioned for oil growth, stronger free cash flow and additional balance sheet improvement despite expected Q2 production curtailments and weaker natural gas prices, UBS Securities said in a note.
The brokerage said in a Thursday note that it expects Q2 cash flow per share of $1.39, above the Street estimate of $1.34, and said temporary gas and NGL curtailments should reverse in Q3.
UBS also sees Permian Resources positioned to pursue additional bolt-on acquisitions, citing management's track record of integrating assets and creating value.
The investment firm said expanded gas transportation capacity expected in 2027 should make natural gas a stronger contributor to future free cash flow and also expects further debt reduction.
UBS maintained its buy rating and lowered its price target to $24 from $25.
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