Piper Sandler sets $11 target for Prairie Operating stock

Published 30/04/2025, 06:30
Piper Sandler sets $11 target for Prairie Operating stock

On Wednesday, Piper Sandler initiated coverage on Prairie Operating Co (NASDAQ:PROP) with an Overweight rating and a price target of $11.00, representing significant upside potential from the current price of $3.96. The investment firm’s analysis highlighted the company’s strategic consolidation efforts in the northern DJ basin’s oil-window, though InvestingPro data shows the stock has declined over 70% in the past year.

Prairie Operating Co has completed approximately $800 million in transactions from fiscal year 2023 to 2025. These acquisitions have provided the company with around ten years of project inventory, with plans to extend this further through additional accretive purchases. With a market capitalization of $170 million and operating with moderate debt levels, the company faces some financial challenges, including a current ratio of 0.29.

The recent acquisition of Bayswater is a significant contributor to Prairie Operating’s current production levels. The company has a one-rig development program that is expected to foster robust oil-weighted growth leading into the end of 2025 and into fiscal year 2026.

Piper Sandler is attentive to the upcoming operated data from Prairie Operating’s initial development at the Shelduck location. The firm is also anticipating the results from the company’s Genesis position, which has not been fully developed and is considered to hold substantial potential for increasing the company’s net asset value.

In other recent news, Prairie Operating Co. has completed the acquisition of specific oil and gas properties from Bayswater Resources and its affiliates, as detailed in their SEC filing. This strategic move is expected to enhance Prairie’s position in the energy sector by integrating these new assets into its portfolio. Additionally, Prairie Operating Co. has extended the deadline for its Purchase and Sale Agreement with various Bayswater entities to March 20, 2025, allowing more time to finalize the transaction. In terms of financial performance, Clear Street has initiated coverage on Prairie Operating Co. with a Buy rating and a $16.00 price target, citing the company’s growth prospects and cost efficiency in oil production. Clear Street forecasts a 72% production growth for Prairie next year and projects the company will generate $308 million in adjusted EBITDA this year, increasing to $530 million the following year. The firm also anticipates a 71-72% adjusted EBITDA margin, surpassing the average of Prairie’s peer group. These developments underscore Prairie Operating Co.’s efforts to expand its operations and improve its financial performance in the oil and gas industry.

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