Analyst Kalei Akamine from Bank of America Securities reiterated a Sell rating on APA and keeping the price target at $20.00.
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Kalei Akamine has given his Sell rating due to a combination of factors related to APA’s operational and financial outlook. Despite APA’s recent solid performance, including a beat on adjusted EBITDA and cash flow expectations, there are concerns about the company’s higher cost operations in the Permian Basin compared to its peers. This is compounded by uncertainties surrounding oil prices in 2026 and ongoing decommissioning costs in the North Sea, which pose risks to APA’s financial stability.
Additionally, while APA has made progress in cost savings and debt reduction, the long-term target for net debt remains a challenge. The company’s current price is above the price objective set by Bank of America Securities, indicating potential overvaluation. These factors contribute to a cautious outlook, leading to the Underperform rating despite recent operational improvements in regions like Egypt and the Permian.