St. Mary could become a target of a large energy outfit, says Will Nasgovitz, whose Heartland Select Value Fund owns the stock. Applying recent transaction prices to St. Mary's existing assets, and assuming $80 crude (it's near $115 a barrel) and $8 natural-gas prices, he contends that the stock is worth 75, nearly twice its current price of 43. Nasgovitz estimates that St. Mary's acres in the Haynesville region, where Texas meets Arkansas and Louisiana, would bring $16 a share, based on recent purchases by Chesapeake and Plains Exploration and Production (PXP). Add another $12 a share for Woodford acres in Oklahoma and $12 for Bakken land in Montana, and you're at $40, but "these plays account for a fraction of their total production," says Nasgovitz. "The assets are worth more, if they sell."

Excellent mgt, located in the middle of the new Bakken oil and gas field, has other outstanding assets, pays a dividend for several years

So what does he like? There's plenty of value left in energy stocks, particularly natural gas. One example is St. Mary Land and Exploration (SM), which has a market cap of $3.5 billion and is trading at roughly 11 times this year's consensus estimate of $4.74 a share, and 4.5 times Ebitda. The peer group grades at 6 to 10 times Ebitda, he says.

Rating on St. Mary Land (SM) was raised to Buy, Suntrust Robinson Humphrey said. $49 price target. Stock is wihin 10% of its 52-week low, and the company offers above-average growth potential. $49 price target.

natural resource, energy

own it

Upgraded by Sun Trust Rbsn Humphrey from Neutral to Buy

Downgraded by Sun Trust Rbsn Humphrey from Buy to Neutral