Ahead of management expectations, Karoon Energy brought online PAT-1, the second production well at Patola, which again outpaced expectations with initial oil production of circa 12kbopd, explains Morgans.

The company is now guiding for initial stable production of 10-15kbopd, up from 10kbopd.

The analyst points to a current unsustainable discount in Karoon Energy shares and notes management is executing on unlocking value from Bauna and building itself into a formidable energy player.

The Add rating is maintained and the target rises to $3.80 from $3.60. The broker also are more welcoming investment climate after Brazil announced new incentives to encourage oil and gas investment/supply.

Sector: Energy.

Target price is $3.80.Current Price is $2.29. Difference: $1.51 - (brackets indicate current price is over target). If KAR meets the Morgans target it will return approximately 40% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2023 Acquisdata Pty Ltd., source FN Arena