Pioneer Natural Resources (NYSE:PXD) should grow by double-digits for some time, says Barclays (NYSE:BCS), citing their exposure to Eagle ford shale and Spraberry Trend Field.
Barclays said, "Strong growth in the Spraberry Trend Field and from the emerging Eagle ford shale play should drive double-digit volume growth as well as margin expansion in 2011 and beyond. PXD trades at a premium to historical multiples of forward cash flow estimates but we feel the premium is justified by the prospects of accelerated cash flow growth.
"Higher projected 2011 cash flow (+$60mm) and an increased target multiple (to 7.5x 2011E PICF) each account for about half of the target price increase. PXD trades at a debt-adjusted multiple of 7.2 x mid-cycle estimates; a 13% premium to peer averages."
Barclays maintains an "Equalweight" oil and gas company. Pioneer closed Thursday at $69.18, losing $0.72, or 1.03 percent. Barclays has a price target of $72 on them, raising it from $65.
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