TD Securities Downgrades Athabasca Oil (TSE:ATH) to Strong Sell

Athabasca Oil (TSE:ATH) was downgraded by research analysts at TD Securities from a “hold” rating to a “strong sell” rating in a note issued to investors on Monday, Zacks reports.

A number of other research analysts have also weighed in on ATH. Desjardins set a C$12.50 price objective on Athabasca Oil and gave the company a “hold” rating in a report on Friday, July 17th. TD cut shares of Athabasca Oil from a “hold” rating to a “tender” rating and increased their target price for the company from C$11.00 to C$12.00 in a research report on Tuesday. BMO Capital Markets downgraded shares of Athabasca Oil from an “outperform” rating to a “hold” rating and set a C$12.50 price target on the stock. in a research note on Wednesday, September 16th. Finally, Royal Bank Of Canada set a C$12.00 price target on shares of Athabasca Oil and gave the stock a “sector perform” rating in a research report on Thursday, September 10th. Three research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, the stock has a consensus rating of “Hold” and a consensus price target of C$11.61.

Athabasca Oil Trading Up 1.8%

Shares of Athabasca Oil stock opened at C$12.23 on Monday. The company has a current ratio of 1.90, a quick ratio of 1.24 and a debt-to-equity ratio of 10.95. Athabasca Oil has a twelve month low of C$6.11 and a twelve month high of C$12.86. The firm has a market capitalization of C$5.89 billion, a PE ratio of 26.02, a P/E/G ratio of -0.51 and a beta of 0.10. The firm’s 50-day moving average price is C$10.64 and its 200 day moving average price is C$10.87.

Athabasca Oil (TSE:ATH) last announced its earnings results on Thursday, July 30th. The oil and gas exploration company reported C$0.13 EPS for the quarter. The business had revenue of C$306.54 million during the quarter. Athabasca Oil had a return on equity of 12.57% and a net margin of 17.68%. On average, sell-side analysts predict that Athabasca Oil will post 0.5403473 EPS for the current fiscal year.

Insider Transactions at Athabasca Oil

In related news, insider Athabasca Oil Corporation bought 48,700 shares of the business’s stock in a transaction on Tuesday, September 29th. The stock was acquired at an average cost of C$10.28 per share, with a total value of C$500,636.00. Following the purchase, the insider directly owned 985,700 shares of the company’s stock, valued at C$10,132,996. The trade was a 5.20% increase in their ownership of the stock. In the last three months, insiders acquired 1,150,600 shares of company stock valued at $12,167,863. 0.24% of the stock is owned by corporate insiders.

Key Headlines Impacting Athabasca Oil

Here are the key news stories impacting Athabasca Oil this week:

• Positive Sentiment: Cenovus will pay C$12.00 per Athabasca share, representing a 14% premium to Athabasca’s 20-day volume-weighted average price. The consideration will consist of 65% cash and 35% Cenovus shares, with shareholders able to choose their preferred mix, subject to allocation limits. Athabasca Oil Announces Agreement to be Acquired by Cenovus Energy
• Positive Sentiment: The deal gives Athabasca investors a defined takeover value and reflects Cenovus’s interest in expanding its oil-sands operations. The acquisition is expected to add roughly 45,000 barrels of oil equivalent per day to Cenovus’s production and provide greater control of strategic oil-sands and Duvernay assets. Cenovus to Buy Athabasca Oil at US$4 Billion Valuation
• Neutral Sentiment: TD downgraded Athabasca from “hold” to “tender” while raising its price target from C$11.00 to C$12.00. The recommendation indicates investors should tender their shares into the acquisition rather than continue holding the standalone company, with the target aligned to the cash offer. BayStreet report
• Negative Sentiment: Because Athabasca’s shares are trading around or above the C$12.00 offer price, further upside is limited unless the transaction terms improve. Investors also remain exposed to closing, regulatory and shareholder-approval risks, while the stock’s value will partly depend on Cenovus’s share price for the stock component.

Athabasca Oil Company Profile

Athabasca Oil Corporation is a Canadian energy company with a focused strategy on the development of thermal and light oil assets. Situated in Alberta’s Western Canadian Sedimentary Basin, the Company has amassed a significant land base of extensive, high quality resources. Athabasca’s light oil assets are held in a private subsidiary (Duvernay Energy Corporation) in which Athabasca owns a 70% equity interest. Athabasca’s common shares trade on the TSX under the symbol ‘ATH’.