Zacks Investment Research upgraded shares of Stone Energy Corporation (SGY) from UNDERPERFORM to NEUTRAL on April 25, 2013, with a target price of $20.00.
We are upgrading our recommendation on Stone Energy from Underperform to Neutral. The company has a multi-year inventory of drilling prospects. The company is working on a strategy to fund its growth areas in Appalachia, the Rockies and the Deep Gas/Deepwater in the conventional shelf. It is actively engaged in horizontal well drilling in the Marcellus Shale and involved in various vertical tests in the Bakken Shale play. These are likely to add to revenues in the coming quarters. However, any delay in the operations of these wells will negatively affect the company s earnings. Further, the company's results are directly exposed to oil and gas prices, which are inherently volatile and subject to complex market forces.
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