NOV - NOV raised to Buy at Citi on higher oilfield spending; Pioneer Natural cut

Ratings for NOV Inc. ( NYSE: NOV ) and Pioneer Natural Resources ( NYSE: PXD ) were switched Wednesday at Citi, which upgraded NOV to Buy from Neutral with a $25 price target, up from $20, while Pioneer Natural is cut to Neutral from Buy with a $240 PT, trimmed from $257, but shares are little changed as crude oil ticked lower.

NOV's ( NOV ) recovery has been slowed by global oilfield services exposure and supply chain woes, but both appear to be improving, said Citi analyst Scott Gruber, who foresees a return to ~15% EBITDA margin in 2024 as upstream oil and gas spending rises and supply chain constraints ease.

Gruber downgraded Pioneer Natural Resources ( PXD ), seeing a combination of higher taxes and lower productivity pushing free cash flow yield to 7.5%, with the stock appearing to embed $70-$80 WTI crude at a 8%-10% discount rate, which he said suggests limited upside for the stock.

Pioneer Natural Resources offers "one of the largest dividends out there," Louis Sutton writes in an analysis published on Seeking Alpha .

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