California Resources stock price target raised to $68 from $65 at TD Cowen

Investing.com - TD Cowen raised its price target on California Resources (NYSE:CRC) to $68.00 from $65.00 on Monday, while maintaining a Buy rating on the stock. The target adjustment comes as InvestingPro data shows Berry Corporation (BRY) trading at fair value, with a solid gross profit margin of 55% and maintaining dividend payments for 8 consecutive years.

The price target increase follows California Resources’ announcement that it will acquire BRY in an all-equity deal valued at $717 million including debt, representing a 15% premium to BRY’s closing price on Friday.

The acquisition comes after the passage of SB-237, which lifted the drilling moratorium in California, creating new opportunities for energy companies operating in the state.

TD Cowen noted that BRY currently trades at $30,000 per flowing barrel of oil equivalent per day (BOED) and 2.9x FY25E EBITDAX, compared to California Resources’ $38,000 per flowing BOED and 4x FY25E EBITDAX.

California Resources expects to achieve $80-$90 million in annual synergies within 12 months of the acquisition and projects a 14% increase in free cash flow per share, according to TD Cowen’s analysis.

In other recent news, California Resources Corporation announced its plan to acquire Berry Corporation in an all-stock transaction valued at approximately $717 million, including Berry’s net debt. Under the agreement, Berry shareholders will receive 0.0718 shares of California Resources common stock for each Berry share, which represents a 15% premium based on the closing prices on September 12. Upon closing, existing California Resources shareholders are expected to own about 94% of the combined entity. In recent earnings news, Berry Petroleum reported its Q2 2025 results, revealing a significant earnings per share (EPS) miss, with an EPS of $0, compared to the forecasted $0.034. However, Berry’s revenue for the quarter was $210.08 million, exceeding expectations by 36.19%. Despite the revenue beat, the company’s stock price experienced a decline following the earnings announcement. These developments highlight key financial and strategic movements for both companies.

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