Topeka reaffirmed its "buy" rating for PDC Energy, an oil and natural gas company.
The company's production is expected to be lower than previously estimated to 36.6 million barrels of oil equivalents a day in the second quarter of 2015, compared with the consensus of 37.3 million barrels of oil equivalents a day, Topeka Capital said in an analyst note.
The lower production estimates are caused by delays from weather-related problems, the firm said.
The price for crude oil (WTI) is down by 1.25% to $52.08 per barrel and the Brent crude is lower by 1.52% to $57.84 per barrel this afternoon, according to CNBC.com.
PDC Energy's production growth, however, is still strong and expected to increase in the third quarter, according to analysts.
PDC Energy will report its 2015 second quarter results on August 10.
Separately, TheStreet Ratings team rates PDC ENERGY INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate PDC ENERGY INC (PDCE) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 38.9%. Since the same quarter one year prior, revenues rose by 17.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.45, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that PDCE's debt-to-equity ratio is low, the quick ratio, which is currently 0.66, displays a potential problem in covering short-term cash needs.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, PDC ENERGY INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- PDCE has underperformed the S&P 500 Index, declining 18.52% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- You can view the full analysis from the report here: PDCE Ratings Report