CRC - California Resources upgraded at BofA as regulatory headwinds subside

California Resources ( NYSE: CRC ) +2.5% in Tuesday's trading as Bank of America upgraded shares to Neutral from Underperform with a $58 price target, raised from $49, saying the company's worst case regulatory scenario is now "in the rearview mirror."

The Neutral rating reflects the abatement of regulatory headwinds in California and the roll off of out-of-the-money oil hedges in 2023 that underpins modest free cash flow expansion.

In August, the company was forced to revise guidance due to a lawsuit that froze the oil and gas permitting process in Kern County; earlier this month, the court ruled the latest version of the EIR satisfied the required changes and reinstated the permitting process.

California Resources ( CRC ) shares are "mighty cheap, largely because of the risks that come from doing business in California," Michael Boyd writes in an analysis posted recently on Seeking Alpha .

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