We are upgrading PetroChina Co. (PTR) ADRs to Outperform from Neutral, reflecting its leverage to the fast-growing Chinese market and the turnaround in commodity prices. Being one of only two Chinese integrated oil companies, PetroChina is well-positioned to capitalize on these favorable trends.
We also like the company’s recent agreement to buy half of EnCana’s prolific Cutbank Ridge shale natural gas assets. Attractive growth prospects in the downstream and natural gas sectors are other positives in the PetroChina story.
The company’s long-term outlook is compelling, despite some near- to medium-term concerns that include heavy exposure to significantly mature-producing areas, high-priced gas imports and uncertainty regarding the impact of the newly rolled-out national resources tax.
PETROCHINA ADR (PTR): Free Stock Analysis Report
Zacks Investment Research
