BofA/Merrill analyst Doug Leggate downgraded California Resources to Neutral from Buy and lowered its price target to $36 from $66. Leggate downgraded a number of U.S. Oil and Gas stocks, stating that he prefers "discipline over growth" among large caps. Leggate and the team acknowledge a recovery in oil prices could lead to material upside, but views volatility as the biggest challenge as too many stocks are competing for shrinking investor dollars. The analyst said California Resources' capital structure is still heavily weighted towards debt, and contends with current commodity volatility, a Neutral rating is more appropriate.