Maintaining a Hold: Balancing Buybacks, Capital Expenditure, and Conservative Shareholder Returns at Range Resources

In a report released today, Gabriele Sorbara from Siebert Williams Shank & Co reiterated a Hold rating on Range Resources (RRC – Research Report), with a price target of $39.00.

Gabriele Sorbara has given his Hold rating due to a combination of factors that suggest a balanced outlook for Range Resources. Notably, the company has a substantial amount of its buyback authorization remaining, with approximately $1.1 billion yet to be utilized out of a total $1.5 billion. Furthermore, the firm’s capital expenditures are expected to increase in the second quarter, with a significant portion of the spending planned for the first half of the year. Sorbara’s analysis indicates that while there may be potential for upside in the near term, especially following a production beat in the first quarter, the financial commitments and spending patterns warrant a cautious stance.

Additionally, the company’s return of capital to shareholders in the form of dividends was slightly below Sorbara’s estimates, with the actual figures falling short of the projected $30.6 million. This discrepancy, which includes a lesser amount of buybacks than anticipated, reflects a modest dividend yield of 0.9%. Collectively, these financial indicators paint a picture of a company that is managing its resources and shareholder returns in a conservative manner. Such fiscal prudence, while commendable, does not necessarily signal a compelling buy opportunity at this moment, leading Sorbara to recommend a Hold on Range Resources’ stock.

In another report released yesterday, Jefferies also maintained a Hold rating on the stock with a $32.00 price target.

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Range Resources (RRC) Company Description:

Range Resources Corp. engages in the exploration, development, and acquisition of natural gas and oil properties in the Appalachian and Midcontinent regions. The company was founded in 1976 and is headquartered in Fort Worth, TX.