Entering text into the input field will update the search result below

Crescent Point deal for Legacy Oil has many positives, but shares fall 5%

  • Analysts appear to appreciate Crescent Point Energy's (NYSE:CPG) C$1.53B takeover of Legacy Oil + Gas (OTCPK:LEGPF) more than investors; analysts say the deal makes a lot of sense, but investors nevertheless sent CPG shares 5% lower in today's trade.
  • Roughly two-thirds of Legacy’s production folding into CPG's core areas, the land being acquired provides an attractive entry into an area of Saskatchewan where Legacy has been posting strong results, and the deal may have a positive impact on the prospects for CPG’s dividend.
  • Raymond James analyst Chris Cox thinks the deal provides investors with greater visibility around the sustainability of CPG’s dividend beyond 2015; he believes CPG will be able to fully fund its capital program and current dividend at $70-$75 oil prices in 2016.
  • Brian Kristjansen at Dundee Capital upgrades CPG to Buy from Hold, noting that Legacy’s overlevered position and resulting share price weakness allowed it to be bought at an attractive level.
  • Analysts say debt-burdened Canadian companies including Lightstream Resources (OTC:LSTMF), Penn West Petroleum (PWE) and Connacher Oil and Gas (OTCPK:CLLZF) could become targets as larger buyers become active.

Recommended For You

Related Stocks

SymbolLast Price% Chg
CPG
--
CPG:CA
--
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.