BMO Capital Turns Bullish on Southwestern Energy


Shares of Southwestern Energy Co. were up 2% Monday after BMO Capital issued a bullish note on the energy company and raised the stock’s rating to outperform from market perform with an $18 per share price target.

The brokerage said the company affords an inexpensively priced exposure to a potential improvement in the natural gas supply and demand balance.

BMO Capital also noted that SWN shares are trading at 6.6 times expected FY17 EBITDA, compared to a 8.3 median multiple for the group, and that the discount is “not fully justified when looking at still-strong debt-adjusted growth measures.”

BMO Capital added that Southwestern Energy could be viewed as a hedge on OPEC (Organization of the Petroleum Exporting Countries) not acting this week in a way that meets expectations.