Range Resources shares up after upgrade, oil rises

Shares of Range Resources Corp. rose Friday after an analyst upgraded the oil and gas company, and crude oil prices rebounded slightly on the New York Mercantile Exchange.

The stock rose 72 cents to $57.88 in morning trading.

Stifel Nicolaus & Co. analyst Michael Hall upgraded the Fort Worth, Texas-based company to "Buy" from "Hold" with an $84 price target, implying he expects the stock to rise 47 percent over Thursday's $57.16 close.

Meanwhile, light, sweet crude for August delivery was up $1.25 at $130.54 a barrel on the Nymex.

Recent uncertainty surrounding the Marcellus Shale area "has provided an opportunity to get more aggressive with Range shares, as the company is the leader in what will be an important, likely highly economic shale gas play in the coming years," Hall wrote in a note to clients.

The Marcellus Shale area, a deep gas reservoir, is a layer of rock that extends from western New York across Pennsylvania and into eastern Ohio and parts of West Virginia.

Hall said a recent meeting with management left him confident in the company's development plans. While industry headwinds may prevail for some time in the Marcellus region, the company's plans are in place with little execution risk at least through 2009 and beyond, he said.

"While at times we doubting our waiting on Range shares, we believe we have finally gotten our opportunity," Hall said.

So far this year, the stock is up about 11 percent. The company is scheduled to report its quarterly results next week.