Scotiabank analyst Cameron Bean upgraded Kelt Exploration to Outperform from Sector Perform with a price target of C$8.50, up from C$7.50, as it believes a premium multiple is warranted due to the company’s position as "a potential vendor of premium Montney assets in a market where inventory-focused transactions are ramping." Recent transactions provide "a strong precedent" for valuing Kelt’s Wembley Montney asset at nearly $800M, or roughly 86% of the current enterprise value, while the aggregate valuation metrics from about $5B of recent Montney transactions suggest that $8.50 per share is "a reasonable market value for the company’s full asset portfolio," the analyst tells investors.
Published first on TheFly
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