Analysts Offer Insights on Materials Companies: Legacy Reserves Lp (NASDAQ: LGCY), Aemetis (NASDAQ: AMTX) and EP Energy (NYSE: EPE)

By Ryan Adsit

Analysts fell to the sidelines weighing in on Legacy Reserves Lp (NASDAQ: LGCY), Aemetis (NASDAQ: AMTX) and EP Energy (NYSE: EPE) with neutral ratings,indicating that the experts are neither bullish nor bearish on the stocks.

Legacy Reserves Lp (NASDAQ: LGCY)

FBR Capital analyst Chad Mabry reiterated a Hold rating on Legacy Reserves Lp (NASDAQ: LGCY) yesterday and set a price target of $2. The company’s shares opened today at $2.07.

Mabry observed:

“We are lowering our price target on Legacy Reserves LP to $2.00/unit (from $2.50) following the partnership’s 1Q17 earnings update earlier this month. The quarter was a miss, and our 2017 EBITDA estimate is coming down, but we remain intrigued by LGCY’s position in the prolific Permian Basin.”

According to TipRanks.com, Mabry is ranked 0 out of 5 stars with an average return of -19.0% and a 35.0% success rate. Mabry covers the Basic Materials sector, focusing on stocks such as Vanguard Natural Resources LLC, Contango Oil & Gas Company, and Mid-Con Energy Partners Lp.

Legacy Reserves Lp has an analyst consensus of Hold, with a price target consensus of $2.

Aemetis (NASDAQ: AMTX)

In a report released today, Carter Driscoll from FBR Capital reiterated a Hold rating on Aemetis (NASDAQ: AMTX), with a price target of $2. The company’s shares opened today at $1.29, close to its 52-week low of $1.01.

Driscoll said:

“Weather affects 1Q, but India biodiesel agreements could be very positive. AMTX missed our 1Q estimates on higher-than-expected feedstock costs and slightly lower volumes and prices, affected by wet weather in California. Higher rail costs to deliver feedstocks caused gross profit to be negative, but this should mitigate in 2H17. On a positive note, AMTX announced a series of milestones in India to deliver biodiesel locally and for export, primarily to Europe. First, the company announced a six- month contract with Indian-owned domestic oil marketing companies to supply 7,500 tons of biodiesel for ~$6 million in revenues on a flat price ($800/tonne). Second, AMTX indicated it is close to signing a three-year contract with a major Indian oil company to export biodiesel, largely to Europe, potentially supported by letters of credit. Recall that on January 1, 2017, the EU eliminated a 6.5% Indian tariff barrier, potentially facilitating the low-cost export of Indian biodiesel to Europe. The company indicated volumes could far surpass nameplate capacity (50 MGY capacity) of its Kakinada, India plant.”

According to TipRanks.com, Driscoll is ranked 0 out of 5 stars with an average return of -9.0% and a 39.8% success rate. Driscoll covers the Industrial Goods sector, focusing on stocks such as Ballard Power Systems, Amer Superconductor, and Hydrogenics Corp.

Aemetis has an analyst consensus of Hold, with a price target consensus of $2.

EP Energy (NYSE: EPE)

FBR Capital analyst Joseph Allman reiterated a Hold rating on EP Energy (NYSE: EPE) today and set a price target of $4.50. The company’s shares opened today at $4.55.

Allman commented:

“We updated our model for marked-to-market commodity prices and the latest financial and operations data, including 1Q17 results.”

According to TipRanks.com, Allman is ranked 0 out of 5 stars with an average return of -7.1% and a 33.9% success rate. Allman covers the Basic Materials sector, focusing on stocks such as Approach Resources Inc, Whiting Petroleum Corp, and Continental Resources.

Currently, the analyst consensus on EP Energy is Moderate Buy and the average price target is $4.88, representing a 7.3% upside.

In a report released yesterday, BMO Capital also reiterated a Hold rating on the stock with a $4 price target.

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