Civitas Resources initiated with an Overweight at Morgan Stanley

Morgan Stanley analyst Devin McDermott initiated coverage of Civitas Resources (CIVI) with an Overweight rating and $64 price target amid a broader research note on the North American E&Ps. Civitas Resources’s strong free cash flow supports a peer-leading total shareholder return yield in 2025, and while regulatory risk in Colorado has been an overhang on the stock in the past, a recent agreement with the government and environmental groups now removes this uncertainty for the next few years, the analyst tells investors in a research note. The company’s entry into the Permian has created a more balanced portfolio with greater operational flexibility, Morgan Stanley adds.