Viper Energy initiated with a Buy at Goldman Sachs

Goldman Sachs initiated coverage of Viper Energy (VNOM) with a Buy rating and $70 price target implying 29% upside from current levels. Viper’s no capex business model allows investors to gain exposure to oil and natural gas properties while generating a dividend at a better conversion ratio than the traditional exploration and production business model, the analyst tells investors in a research note. The firm recommends the shares given the company’s “unique business model and the potential for organic and inorganic growth driven by a best-in-class parent company.”