Range Resources price target lowered by $3 at Citi, here’s why

Citi lowered the firm’s price target on Range Resources to $33 from $36 and keeps a Neutral rating on the shares. Entering 2024, the macro backdrop appears challenging for the exploration and production companies as oil and gas markets appear adequately supplied, recession risk is still lingering, cost deflation appears modest and efficiency gains likely moderate, the analyst tells investors in a research note. The firm says that with “OPEC cohesion risk now also casting a cloud over the E&P sector, selective stock picking is likely to remain the optimal strategy in 2024.” Citi thinks trends in capital efficiency should continue to drive stock performance, and it also prefers a bent toward gas later in the year. The firms’ top picks include Coterra Energy (CTRA), Ovintiv (OVV), Permian Resources (PR) and Chord Energy (CHRD). Citi upgraded Coterra, Southwestern Energy (SWN) and EQT Corp. (EQT) to Buy and downgrade Magnolia Oil & Gas (MGY) to Sell.