Raymond James has revised its outlook on Canadian Natural Resources (CNQ, Financial), upgrading the stock to an "Outperform" rating from its previous "Market Perform" status. The analyst, Michael Barth, set a new price target of C$49, a decrease from the former target of C$52. Despite the adjustment, this new target signifies a potential 36% upside for the shares.
Year-to-date, Canadian Natural (CNQ, Financial) shares have declined by almost 20%. However, the firm believes that the current valuation overly discounts the company's prospects, assuming a flat oil price of $54 per barrel indefinitely. Given Canadian Natural's status as one of Canada's most efficient producers and capital allocators, the analyst suggests that the current stock valuation does not reflect its true potential.
The revised outlook underscores a belief that the risks associated with Canadian Natural's stock are now more positively aligned, suggesting greater appreciation potential in the market. Raymond James' updated model supports the view that the stock's valuation has room to grow.
