On Friday, UBS has increased the price target for Coterra Energy (NYSE:CTRA) shares to $32 from $31, while keeping a Buy rating on the stock. The adjustment comes after Coterra's fourth-quarter 2023 performance, which UBS views as a standout among exploration and production companies.
Coterra's fourth-quarter crude oil production exceeded the upper range of its guidance, a positive indicator for the company's operational capabilities. Additionally, Coterra introduced a new three-year outlook that suggests higher oil volumes from fiscal year 2024 to 2026, with a roughly 10% reduction in annual capital expenditures.
The firm believes Coterra's enhanced capital efficiency and stronger balance sheet will enable the company to return more capital to shareholders. These factors are particularly important as they could provide Coterra with an advantage over its competitors, especially in a context of weaker natural gas prices.
Coterra Energy's recent update has led UBS to consider the company a top pick within the natural gas sector of the exploration and production industry. The firm's outlook on Coterra is based on its expectation of increased capital returns and the company's potential to distinguish itself from its peers.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.