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KeyBanc Capital Markets raised its price target on Expand Energy (NASDAQ:EXE) stock to $135.00 from $130.00 on Friday, while maintaining an Overweight rating on the energy company’s shares. The stock, currently trading at $114.96, is approaching its 52-week high of $120.04, and according to InvestingPro analysis, shows potential for further upside.
The price target increase reflects KeyBanc’s view that a "cash return inflection" has arrived for Expand Energy, according to the research note. The firm identified marketing as a "critical lever" that could drive a potential rerating of the stock. This outlook aligns with the company’s impressive 35.62% revenue growth over the last twelve months, as reported by InvestingPro.
KeyBanc expressed confidence in Expand Energy’s prospects for sustained mid-teens return on equity (ROE) as the company leverages strong casualty pricing to drive profitable premium growth. The firm noted this growth would be "increasingly augmented" by the company’s technology-based small-account E&S platform.
The research firm maintained its 2025 and 2026 earnings per share estimates of $1.65 and $2.05 respectively, while introducing a 2027 EPS estimate of $2.40. These projections assume a "broadly-favorable casualty operating environment" and conservative initial accident-year loss picks.
KeyBanc expects solid top-line growth for Expand Energy and noted the company’s insulation from pre-2020 accident year reserve adequacy concerns as factors that could boost the shares over the next 12 months.
In other recent news, Expand Energy reported its first-quarter 2025 earnings, exceeding earnings per share (EPS) expectations with a figure of $2.02, which was 21% above the forecasted $1.67. However, the company’s revenue fell short of expectations, coming in at $2.2 billion against the anticipated $2.49 billion. Piper Sandler analyst Mark Lear (NYSE:LEA) upgraded Expand Energy’s stock from Neutral to Overweight, raising the price target to $139 from $136, citing the company’s strong well productivity and strategic positioning to meet rising natural gas demand. Meanwhile, Bernstein SocGen initiated coverage of Expand Energy with an Outperform rating and a price target of $150, reflecting optimism about a potential U.S. gas supercycle and the company’s role in the Haynesville Shale. The firm also projects that Expand Energy will achieve $500 million in annual savings by 2026, primarily through corporate cost reductions and drilling efficiency improvements. Expand Energy’s strategic moves, including plans to increase its rig count and enhance LNG export capabilities, have positioned it to capitalize on growing energy demands. These developments highlight Expand Energy’s potential for growth amid a robust natural gas market, despite trading at a discount compared to its peers.
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