NEW YORK (AP) -- A shift toward more oil development by Bill Barrett Corp. hasn't been fully appreciated by investors, according to Canaccord Genuity, which raised its price target on the stock Monday.
With natural gas prices extraordinarily low, many energy companies are shifting production to crude. Oil prices rose for a fifth straight day of gains Monday.
Bill Barrett first announced in March it would scale back natural gas drilling and boost oil drilling. With its new business focus, analyst John Gerdes says the company's stock now has an opportunity to grow about 30 percent more than its peers.
There are other catalysts as well, Gerdes said, including plans to drill three additional wells and conduct tests on others.
With the suspension of some natural gas drilling and renewed focus on oil, the analyst suggests that Bill Barrett will grow production by about 80 percent this year and 70 percent in 2013.
Gerdes lifted his target to $38 from $37, indicating potential growth of 62 percent within a year. He also reiterated his "Buy" rating on the stock.
Company shares edged higher by less than 1 percent in premarket trading to $23.68.