Zacks Investment Research upgraded shares of China Petroleum & Chemical Corporation (Sinopec) (SNP) from UNDERPERFORM to OUTPERFORM on September 27, 2013, with a target price of $96.00.
We are upgrading Sinopec to Outperform from Underperform. An increasing trend in production and sales volumes could result in 2013 being a high-profit year for Sinopec, in our view. This will be further amplified by an improvement in realized oil and gas prices. Though the company's asset structure is downstream-weighted, Sinopec s leverage to the lucrative Chinese market is expected to help sustain its growth momentum. Additionally, we believe Sinopec should benefit from potential Exploration & Production asset injections from its parent, which may act as a positive share price catalyst. Management is also now focused on developing bigger natural gas businesses, including conventional, non-conventional and LNG.
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