Forest Oil -38% as Q4 results prompt concerns about asset quality

|About: Forest Oil Corporation (FST)|By:, SA News Editor

Forest Oil (FST -38%) plunges after Q4 earnings and revenues came in below expectations and disappointing Eagle Ford results which further call into question FST's asset quality.

Q4 average net sales volume totaled 164.7M cfe, down 47% Y/Y; average realized prices for gas and oil, including realized derivative gains, were $3.59 and $90.16, respectively, vs. $3.83 and $96.25 in the year-ago period.

Year-end 2013 estimated proved reserves were 625B cfe vs. 1,363B cfe at the end of 2012, mostly the result of 800B cfe of asset sales.

Wells Fargo downgrades shares to Market Perform from Outperform following FST's move to defer 2014 Eagle Ford activity as the company reprocesses existing 3D seismic surveys: "Combined with weaker well results, not what we, nor the Street, wanted to see."

Goldman Sachs reiterates its Sell rating and cuts its price target to $2.50 from $4, citing heightened risk in FST's acreage position, which is "the key asset for the company."