Financial services firm Raymond James recently upgraded Petroquest Energy (PQ:NYSE) to OUTPERFORM from MARKET PERFORM based in part of the company's strong second quarter results.

Petroquest, which focuses mainly on onshore oil drilling, was also upgraded because of its growing size and its La Cantera prospect, which has so far been successful.

The company confirmed 248 feet of net pay at La Cantera, meaning it has about 100 billion of cubic feet equivalent, according to Raymond James. It is expected the well in this prospect will be put into production in the first quarter of 2012, in addition to the drilling of a delineation well, which will cost about $25 million gross.

Petroquest management also said that they had entered the Mississippi Lime play with 40,000 net acres. The first well in this particular play is expected to be drilled later this year.

Raymond James has increased its target price for PetroQuest to $9 and considers it a high risk investment.

Petroquest's oil stock opened at $7.64 per share on Friday, August 5. The stock's 52-week high was $9.75.