Truist Securities has increased its price target on Apache Corp . (NASDAQ: NASDAQ:APA) to $36.00, up from the previous $34.00, while maintaining a Buy rating on the stock. The adjustment follows recent meetings where Apache presented its operational opportunities and strategies.
The company highlighted its prospects in Suriname, the Permian region, and Egypt, which are expected to contribute to its growth. Apache emphasized the potential upside in Suriname following the final investment decision (FID), the high-graded portfolio in the Permian, and the resilience in Egypt amid oil price volatility.
Truist Securities anticipates that Apache will maintain its solid shareholder return plan, which is likely to focus on share buybacks and continued debt reduction. The firm expects that these financial strategies could decrease the company's leverage to well below one time.
In other recent news, Wolfe Research has raised its stock target for Apache Corp, maintaining an Outperform rating due to the first oil development in Suriname. However, Mizuho has maintained an underperform rating on Apache shares, citing the higher costs of the project but also noting the increased scope and resource potential.
APA Corporation has also announced a dividend of 25 cents per share and sold non-core assets in the Permian Basin for $950 million, moves that analysts from TD Cowen, Truist Securities, and Scotiabank have reacted positively to. In addition, APA Corporation extended its agreement with Palantir Technologies (NYSE:PLTR), integrating artificial intelligence capabilities into its operations for several years.
InvestingPro Insights
Recent InvestingPro data aligns with Truist Securities' optimistic outlook on Apache Corp. (NASDAQ: APA). The company's P/E ratio of 2.98 suggests that the stock may be undervalued relative to its earnings, potentially supporting the increased price target. Additionally, APA's strong gross profit margin of 71.39% for the last twelve months as of Q2 2024 indicates efficient operations, which could contribute to the company's ability to maintain its shareholder return plan as anticipated by Truist Securities.
InvestingPro Tips highlight that APA has maintained dividend payments for 54 consecutive years, underscoring the company's commitment to shareholder returns mentioned in the article. This long-standing dividend history may provide additional confidence in Apache's financial stability and management's focus on shareholder value.
It's worth noting that InvestingPro offers 5 additional tips for APA, providing investors with a more comprehensive analysis of the company's financial health and market position. To gain access to these insights and more, consider exploring the full range of data and analysis available on InvestingPro.
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