Shares of Pioneer Natural Resources Co. declined more than 6% as the U.S. oil producer’s $6.4 billion acquisition of Permian Basin rival DoublePoint Energy months after a large deal took investors by surprise, with the sector still recovering from last year’s crash.

The multibillion shale deal comes as investors in the shale patch have called on producers to focus on cash flow and shareholder returns, rather than spending to grow, as demand remains low due to the COVID-19 pandemic.

In January, Pioneer closed its $4.5 billion, all-stock purchase of Parsley Energy, giving it one of the largest positions in the Permian Basin, the top U.S. shale field.

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RBC Capital Markets said it was surprised Pioneer made such a large acquisition after Parsley Energy and that the rationale seemed to be part opportunistic and part defensive.

The stock-and-cash deal for DoublePoint Energy, the largest acquisition of a privately-held U.S. oil producer since 2011, increases Pioneer’s holdings in the Permian to more than 1 million net acres.

KeyBanc downgraded Pioneer to “sector weight” and said it was “one of the highest purchase prices we have seen in years, and it was surprising given the fact that it is largely undeveloped and a bit dilutive to PXD’s average acreage quality.”

DoublePoint Energy will add 97,000 acres to Pioneer’s holdings in the Permian Basin and analysts at Cowen & Co. praised the deal, saying it “undoubtedly fits like a glove within PXD’s Midland Basin acreage and… increases expected per share variable dividends in 2022.”

Morgan Stanley said the acreage overlap of the two companies provides industrial logic for the transaction and viewed the deal as accretive to Pioneer’s free cash-flow.

Pioneer’s shares fell 6.1% to $154.52, slightly more than the 3% decline in oil prices.

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