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Company Profile: Abraxas Petroleum is an independent energy company, developing and producing oil and gas in the U.S. from the Rock Mountain, Permian Basin and Gulf Coast regions.
Share Price: $5.03 (March 29)
Stock Performance This Year: 10%
Analyst Consensus: Wall Street gives Abraxas strong marks, with seven analysts rating the stock a "buy," including those at Wunderlich Securities and R.W. Baird. Three other firms say investors should hold on to shares. No firm has a "sell" rating on Abraxas. The average price target of $6 implies 21% upside potential.
Bullish Case: Canaccord Genuity analyst Derrick Whitfield on March 21 reiterated his firm's "buy" rating on Abraxas and increased his price target to $5.50 from $5, citing the company's transformation progress and growing exposure to an oil-weighted production base. "We continue to believe there is significant value embedded in the company's oil plays that will be unlocked this year through the successful execution of its first wells in the Bakken, Eagle Ford, Niobrara and Permian projects," Whitfield wrote in the research report.
TheStreet Ratings has a "hold" on the stock, saying Abraxas' strengths in revenue growth and earnings per share growth are countered by weak cash flow from operations. While the stock has more than doubled in the past year, TheStreet Ratings says investors can't assume past performance will drive future results. "Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere," the March 20 research report says.