Prairie Operating stock initiated with Buy rating at Roth/MKM

Roth/MKM initiated coverage on Prairie Operating Co (NASDAQ:PROP) with a Buy rating and an $8.00 price target on Wednesday. According to InvestingPro data, analysts have set targets ranging from $8 to $10, with a consensus recommendation of "Strong Buy" despite the stock’s 69% decline over the past year.

The research firm highlighted Prairie’s 47,500 net acre position in the DJ Basin’s oil window and its liquid-focused production of approximately 26,000 barrels of oil equivalent per day, consisting of 45% oil and 25% natural gas liquids. The company maintains a high gross profit margin of 69%, though InvestingPro analysis reveals significant debt obligations with a debt-to-equity ratio of 11.16x.

Prairie Operating is relatively new as a public company, having brought its first operated wells online in February 2025, with free cash flow not expected until year-end 2025, according to Roth/MKM.

The company plans to grow production by more than 10% annually "for the foreseeable future" if current oil prices hold, with Roth/MKM projecting organic production growth exceeding 400% in 2025 and approximately 25% in 2026.

Roth/MKM noted that Prairie would likely reduce its growth plans if West Texas Intermediate oil prices move into the $50-$55 per barrel range.

In other recent news, Prairie Operating Co. has reaffirmed its Reserve-Based Lending (RBL) credit facility at $475 million, with potential expansion to $1 billion, led by Citibank, N.A. This development reflects confidence in the company’s asset base and strategic execution, as noted by Chairman and CEO Edward Kovalik. Citi analysts have initiated coverage on Prairie Operating with a Buy rating and an $8.00 price target, citing the company’s consolidation capabilities and growth strategy in the Denver-Julesburg (DJ) Basin. Piper Sandler also initiated coverage with an Overweight rating, setting a higher price target of $11.00, highlighting Prairie Operating’s strategic acquisitions and development plans. The company recently appointed Maree K. Delgado as Senior Vice President of Accounting, bringing over 20 years of experience in financial accounting and regulatory compliance. These appointments and strategic moves are part of Prairie Operating’s broader efforts to maximize returns and support growth through capital discipline. Additionally, the company’s acquisition of Bayswater is noted as a key factor in its current production levels, with further plans to expand its project inventory. Prairie Operating’s initiatives and analyst endorsements position the company for continued growth and development within the energy sector.

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