Canadian OFS sector: Canaccord hikes PTs, remains wary of balance sheet risks

Source Energy Services

18/06/2020 11:29

** Brokerage Canaccord Genuity raises PTs on several
Canadian oilfield services providers, citing recent equity
strength accompanied by extreme volatility
    ** Says it is becoming increasingly accustomed to extreme
volatility in the sector, with many large OFS cos rallying >50%
through first 10 days of June
    ** Despite investors' seemingly new-found appetite for OFS
equities, remain cognizant of balance sheet risks - Canaccord
    ** Views Mullen Group  MTL.TO , Secure Energy Services
 SES.TO , Total Energy Services  TOT.TO  and CES Energy
Solutions  CEU.TO  as best-positioned to manage a protracted
downturn
    ** Expects Calfrac Well Services  CFW.TO  and Source Energy
Services  SHLE.TO  to face the greatest balance sheet risk over
the near- to medium-term
    ** Says further upside potential comes with growing risk;
OFS equities now reflect a recovery by 2022
    ** Canaccord remains largely on the sidelines from an
investment perspective
    
 Companies        PT changes
 Ensign Energy    Raises PT to C$1.25 from
 Services         C$0.9
 Mullen Group     Raises PT to C$7.5 from C$6
 Precision        Raises PT to C$1.25 from
 Drilling Corp    C$0.9
 Secure Energy    Raises PT to C$2 from C$1.5
 Services         
 Tervita Corp     Raises PT to C$4.5 from C$4
 Total Energy     Raises PT to C$3 from C$2.5
 Services         
 Trican Well      Raises PT to C$1 from C$0.9
 Service          
 

 (Reporting by Arundhati Sarkar in Bengaluru)
 ((Arundhati.Sarkar@thomsonreuters.com))