Tudor, Pickering, Holt on Tuesday reiterated its buy rating on the shares of ARC Resources (ARX.TO) with a C$30.00 price target as it revisited its estimates for the Western Canadian natural-gas producer ahead of fourth-quarter results.

"Heading into earnings, we've slightly increased our Q4'24 CFPS estimate to C$1.23 from our prior C$1.20 (ahead of recent Street estimates; though consensus sits at Street C$1.24), all on a true-up for realizations, particularly gas. On ops results, we estimate 383mboepd production (Street 384.5) on capex of TPHe C$356MM (Street C$363MM). Looking ahead to Q1'25, we see estimates heading lower, and currently model TPHe 370mboepd (natural declines at Kakwa; Street 386) and C$580MM capex (Street C$464MM); TPHe marks the high point on the year of spend with quarterly decreases in our model thereafter. For FY'25, however, we remain in-line with guidance as production recovers quickly in Q2'25 and continues growing through H2'25, at TPHe 388mboepd (Street 389) for total capex of TPHe C$1.66B (Street C$1.67B). Operational items of interest continue to center around Attachie, with Phase 1 continuing to ramp up in Q1 and attention thereafter on a potential Phase 2 sanction in the Q3 timeframe (spend would be in 2026 with first production in 2027). Despite recent strength compared to Canadian comps amidst the tariff-driven weakness across the space, relative valuation both within Canada and across broader NAM coverage (TPHe 11% FY'25 FCF/EV at strip) keeps ARX an attractive way to gain liquids-rich exposure in Canada," analyst Jeoffrey Lambujon noted.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

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