Analysts Offer Insights on Materials Companies: Cliffs Natural (NYSE: CLF), Carrizo Oil & Gas (NASDAQ: CRZO) and WPX Energy (NYSE: WPX)

By Austin Angelo

Companies in the Materials sector have received a lot of coverage today as analysts weigh in on Cliffs Natural (NYSE: CLF), Carrizo Oil & Gas (NASDAQ: CRZO) and WPX Energy (NYSE: WPX).

Cliffs Natural (NYSE: CLF)

FBR Capital analyst Lucas Pipes reiterated a Hold rating on Cliffs Natural (NYSE: CLF) today and set a price target of $6. The company’s shares opened today at $5.59.

Pipes noted:

“We are updating our estimates for Cliffs Natural Resources after a 3Q miss last week, October 27. Against our numbers, the miss was driven by lower USIO revenues on lower price realizations, which Cliffs attributed to mix changes. Results also included a number of non-recurring items without which we believe EBITDA would have come in around $80M, versus consensus of $123M. For 2016, Cliffs maintained essentially all volume and cost guidance while tightening APIO pricing guidance and reducing the high end of the USIO price range slightly, which we believe is consistent with the decline in domestic HRC prices. Cliffs did not update its prior 2017 guidance of $500M EBITDA and $200M FCF, including 19M lt USIO sales, arguing that its price expectations are unchanged and that “artificially low” domestic steel prices ought to rise on inventory restocking, the effect of the trade cases, and production discipline.”

According to TipRanks.com, Pipes is a 2-star analyst with an average return of 0.0% and a 48.1% success rate. Pipes covers the Basic Materials sector, focusing on stocks such as Stillwater Mining Company, Westmoreland Coal Company, and Hallador Energy Company.

Cliffs Natural has an analyst consensus of Hold.

Carrizo Oil & Gas (NASDAQ: CRZO)

In a report released today, Stephen Berman from Canaccord Genuity reiterated a Buy rating on Carrizo Oil & Gas (NASDAQ: CRZO), with a price target of $44. The company’s shares opened today at $34.41.

Berman wrote:

“We like CRZO for its large, low-risk drilling inventory in the Eagle Ford (EF), where it has over 100K net acres (pro forma for a pending acquisition), low-cost structure and solid balance sheet. The company also has positions in four other top plays: the Delaware Basin (DB), Niobrara, Utica, and Marcellus.”

According to TipRanks.com, Berman is ranked 0 out of 5 stars with an average return of -20.4% and a 30.5% success rate. Berman covers the Basic Materials sector, focusing on stocks such as Sanchez Energy Corporation, Sundance Energy Australia, and Abraxas Petroleum Corp.

Currently, the analyst consensus on Carrizo Oil & Gas is Moderate Buy and the average price target is $50.33, representing a 46.3% upside.

In a report issued on October 25, FBR Capital also maintained a Buy rating on the stock with a $50 price target.
WPX Energy (NYSE: WPX)

In a report released today, Chad Mabry from FBR Capital reiterated a Buy rating on WPX Energy (NYSE: WPX). The company’s shares opened today at $11.82.

According to TipRanks.com, Mabry is ranked 0 out of 5 stars with an average return of -22.2% and a 31.6% success rate. Mabry covers the Basic Materials sector, focusing on stocks such as Atlas Resource Partners L.P. C, Contango Oil & Gas Company, and Mid-Con Energy Partners Lp.

Currently, the analyst consensus on WPX Energy is Moderate Buy and the average price target is $15.33, representing a 29.7% upside.

In a report released yesterday, J.P. Morgan also reiterated a Buy rating on the stock.