SM Energy price target raised to $50 from $45 at RBC Capital

RBC Capital raised the firm’s price target on SM Energy to $50 from $45 but keeps a Sector Perform rating on the shares after its Q4 earnings beat last month. The firm believes that the company’s greater focus on the oilier Permian should drive stronger returns, while its Austin Chalk remains an option on higher natural gas prices, the analyst tells investors in a research note. RBC adds however that while the company has been more “organic” with acreage expansion/additions along with internal technical inventory development, longer-term, the benefits of scale and core inventory depth could necessitate larger consolidation.