Antero Resources (AR) Stock Price Target Lowered at Barclays

Antero Resources' (AR) price target was lowered to $30 from $31 at Barclays on Tuesday.
By Amanda Albright ,

NEW YORK (TheStreet) -- Barclays lowered its price target on AnteroResources (AR) - Get Report  to $30 from $31 on Tuesday. The firm maintained its "overweight" rating on the stock.

The Denver-based natural gas company is on track to exceed its full-year production guidance of 1.4 Bcfe/d, Barclays said. This would give Antero Resources the potential to beat its 2016 target of 1.75-1.82 Bcfe/d, the firm added.

Antero Resource's attractive gas hedges will play a key role in supporting an active capital program despite weak gas prices, the firm said.

"Despite the hedge protection and strong liquidity, we believe AR's production and spending outlook will still be shaped by gas prices to some extent," Barclays said. "A continued decline in gas prices could result in the deferral of some drilling and completion activity and possibly temporary production curtailments."

Shares of Antero Resources were up 3.59% to $24.24 in late afternoon trading on Tuesday. 

Separately, TheStreet Ratings team rates ANTERO RESOURCES CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

We rate ANTERO RESOURCES CORP (AR) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 243.8% when compared to the same quarter one year ago, falling from -$42.29 million to -$145.37 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 54.99%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 205.88% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • AR's debt-to-equity ratio of 0.86 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.36 is very low and demonstrates very weak liquidity.
  • ANTERO RESOURCES CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, ANTERO RESOURCES CORP turned its bottom line around by earning $2.56 versus -$0.41 in the prior year. For the next year, the market is expecting a contraction of 81.6% in earnings ($0.47 versus $2.56).
  • 48.01% is the gross profit margin for ANTERO RESOURCES CORP which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, AR's net profit margin of -38.58% significantly underperformed when compared to the industry average.
  • You can view the full analysis from the report here: AR
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