Thursday, November 4, 2010

Anadarko Petroleum (NYSE:APC) Should Deliver 7% to 9% Production Growth Long Term

Over the next five years, Anadarko Petroleum (NYSE:APC) should grow production at an annual rate of 7 percent to 9 percent, says Barclays (NYSE:BCS).

"Anadarko reported an adjusted Q3 EPS headline miss of $0.21 vs. our $0.25 and consensus of $0.28. Higher-than-guided G&A contributed to the miss vs. our estimates as APC accrued a $30-million non-executive compensation charge related to a program designed to retain personnel after the Macondo incident. The company slightly raised 2010 production guidance and lowered spending - 3%. We continue to believe the long-term story is intact with APC poised to deliver 7-9% annual production growth for the next five years. The uncertainty surrounding potential liabilities from the Macondo incident is likely to steer performance in the intermediate term."

EPS estimates lowered from $1.85 to $1.55 for the full year 2010, and for the full year 2011 from $1.45 to $0.80.

Anadarko closed down at $63.64, dropping $0.18, or 0.28 percent. Barclays maintains an "Overweight" on them with a price target of $71, raised from $65.

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