Monday, Truist Securities revised its price target on Chord Energy Corp (NASDAQ:CHRD) shares, reducing it slightly to $226 from $228, while reiterating a Buy rating on the stock.
The firm's analyst cited the company's robust capital return strategy, which includes more than 75% of its free cash flow (FCF) going towards significant stock buybacks and substantial base/variable dividends. This approach positions Chord Energy as an appealing investment, especially for those who previously invested in Marathon Oil (NYSE:MRO).
Chord Energy has recently completed its merger with Enerplus (NYSE:ERF), establishing a more dominant presence in the Bakken region. This strategic move places the company at the forefront in terms of scale within the area. The merger is expected to deliver increased annual synergies, now anticipated to be $50 million higher than initially projected.
The company's financial guidance remained largely consistent, with the exception of some adjustments. These modifications include a decrease in gas volumes, attributed to curtailments in the Marcellus region, and a slight downward revision in the oil volumes expected for the second half of 2024. These changes have prompted the analyst to adjust the price target accordingly.
Chord Energy's focus on delivering shareholder value through a combination of dividends and share repurchases continues to be a central part of its financial strategy. The company's merger with Enerplus is a critical development that reinforces its competitive position in the industry.
Despite the minor adjustments to its price target, Truist Securities' outlook on Chord Energy remains positive, as reflected in the maintained Buy rating.
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