LONDON (ShareCast) - (Sharecast News) - Analysts at Canaccord Genuity slightly raised their target price on hydrocarbon exploration firm Vaalco Energy from 335.0p to 345.0p on Monday, stating the firm was currently "well set for growth".
Canaccord said Vaalco's third-quarter results had highlighted the company's operational and financial strength, emphasised by its ability to invest significantly in Etame Marin in Gabon, maintain a debt-free balance sheet with ample cash resources, and now introduce a dividend from the first quarter of 2022.

The Canadian bank noted that capital investment was "shifting gears" in 2022, as the bulk of expenditure associated with both the group's four development/appraisal wells at its Etame Marin asset and the conversion of its FSO were set to take place in the coming year.

Canaccord highlighted that from the first quarter of 2022, production "should start to rise" and that by the year's fourth and final quarter, unit operating costs "should decline further" due to the benefits of its more cost-effective FSO.

"The combination should substantially enhance FCF generation from 2023," said the analysts, who reiterated their 'buy' rating on the stock.

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