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On Tuesday, EOG Resources (NYSE:EOG) received an updated price target from Raymond (NSE:RYMD) James, with analysts at the firm increasing their target to $148.00 from the previous $140.00, while reaffirming their Strong Buy rating on the stock. The revision follows EOG’s first-quarter results and the current commodity price trends. According to InvestingPro data, EOG maintains a "GREAT" financial health score, supported by strong cash flows and a solid balance sheet that holds more cash than debt. The company has also demonstrated remarkable consistency with 36 consecutive years of dividend payments, currently yielding 3.4%.
The report from Raymond James highlights that for the second quarter of 2025 and the full year, EOG’s total production, oil volumes, and capital expenditures are expected to align with the company’s guidance as well as market expectations. Detailed discussions on this guidance are provided later in their analysis. The company’s strong operational performance is reflected in its robust gross profit margin of 62% and return on equity of 21% over the last twelve months.
EOG has adjusted its drilling plans, reducing the number of net well completions in several key areas. In the Delaware Basin, the company now aims for 360 net completions, a decrease from the initially planned 375. Similarly, in the Eagle Ford, completions are down to 110 from 120, and in the Powder River Basin, they are reduced to 25 from 30. However, the plans for the Dorado and Utica plays remain unchanged.
Looking ahead to 2026, the analysts project that EOG’s free cash flow to enterprise value (FCF/EV) yield will be approximately 6.7%, with an enterprise value to EBITDA (EV/EBITDA) multiple of 5.3 times for the fiscal year 2026. The upgrade in the price target to $148 per share is primarily attributed to an improved commodity price outlook since their last report. Raymond James reiterated their strong confidence in EOG Resources, maintaining a Strong Buy rating on the company’s shares. InvestingPro analysis suggests EOG is currently undervalued, with additional insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of this and 1,400+ other US stocks.
In other recent news, EOG Resources reported mixed financial results for the first quarter of 2025. The company exceeded earnings per share expectations with an adjusted EPS of $2.87, surpassing the forecast of $2.71. However, EOG’s revenue fell short, totaling $5.67 billion against an anticipated $5.91 billion. In a strategic move to enhance cash flow, the company announced a $200 million reduction in its 2025 capital investment. EOG also maintains a strong cash balance of $6.6 billion, highlighting its robust financial position.
In addition to financial results, EOG Resources has been granted an oil exploration concession in the UAE. The concession, in partnership with the Abu Dhabi National Oil Company, covers a significant area in the Al Dhafra region. This development marks a step in EOG’s international expansion efforts. Furthermore, EOG announced a bolt-on acquisition in the Eagle Ford, adding 30,000 net acres to its portfolio. The company plans to begin drilling operations on this new acreage within the year.
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