Sell-Side Firm Goes Bearish On Kodiak
By Debra Fiakas, CFA: The last week in December 2011, at least one sell side-firm, Northland Securities, according to Briefing.com, downgraded Kodiak Oil & Gas, Inc. (KOG: NYSE) on valuation. The stock price recently edged above the analyst’s price target and set a new 52-week high. Conventional wisdom is that the larger the sell-side firm the more influence a downgrade can exert on a stock. Sometimes a downgrade creates a buying opportunity for those who think they know better when it comes to value. Oil and gas companies are not the usual equity. Determining value in the sector requires particular measures. I used the five below to put Kodiak’s share price - and valuation - into perspective. Enterprise Value to Earnings Before Interest and Taxes plus Depreciation and Amortization (EV / EBITDA) is a popular benchmark. Enterprise value for Kodiak is $1,936.4 million and EBITDA in the last twelve months is $52.0 million, implyingComplete Story »
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