Bear of the Day: Questar (STR)

We are downgrading Questar (STR) shares to Underperform from Neutral, due to the weak natural gas fundamentals and the company’s clouded post-split outlook. The continued glut in domestic gas supplies continues to weigh on the company, and storage levels remain above their five-year average.

This translates into a bearish near- to medium-term outlook for natural gas-weighted companies like Questar. The transfer of the low-cost and high-growth E&P assets (post-split) have also held back the stock.

These factors are reflected in our downgrade of the company’s shares to Underperform from Neutral. Our $16 price objective reflects 2010 P/E multiple of 14.6x.

QUESTAR (STR): Free Stock Analysis Report

About Zacks Investment Research 1767 Articles

Zacks Investment Research is one of the most highly regarded firms in the investment industry. In 1978 Zacks originated the concept of utilizing earnings estimates revisions to make profitable investment decisions. Zacks offers multiple investment products and services to help investors achieve superior returns.


Be the first to comment

Leave a Reply

Your email address will not be published.