TD Cowen lifts Expand Energy stock rating, raises target to $116

Tuesday, TD Cowen analysts upgraded Expand Energy (NASDAQ:EXE) stock from Hold to Buy, adjusting the price target upwards to $116 from the previous $108. The upgrade aligns with the broader analyst consensus, as 12 analysts have recently revised their earnings estimates upward, with price targets ranging from $85 to $170. The upgrade comes in response to an improved risk/reward outlook for natural gas companies following recent tariff announcements. InvestingPro data shows the stock currently trades at $100.06, with analysts maintaining a bullish consensus rating of 1.77. According to TD Cowen, these changes in the tariff policy could lead to a decrease in rig activity, which is expected to result in below-average natural gas storage levels in 2026, potentially driving up natural gas prices.

Expand Energy, which has significant growth capacity along the Gulf Coast, is well-positioned to benefit from the anticipated market dynamics. The stock has indeed taken a significant hit, with InvestingPro data showing an 11.25% decline over the past week. Despite this recent pullback, TD Cowen sees the current valuation as an attractive entry point for investors, particularly given the company's historically low price volatility with a beta of 0.43.

The analyst's comments highlighted the company's readiness to capitalize on the expected increase in natural gas prices. "We are upgrading EXE along with several of our gassy names on an improved risk/reward skew for gas macro after recent tariff announcements. We anticipate associated rig drops leading to below-average storage in '26 leading to higher natural gas prices. EXE is primed to take advantage given growth capacity along the Gulf Coast while shares are down ~10% since the April 2nd tariff announcement," stated the TD Cowen analyst.

This optimistic outlook places Expand Energy, with its substantial $23.28 billion market capitalization, in a favorable position within the energy sector, especially for those companies involved in the production and distribution of natural gas. While the company wasn't profitable in the last twelve months, InvestingPro analysis indicates expected profitability this year, supporting TD Cowen's confidence in the revised price target of $116. For deeper insights into EXE's valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which covers over 1,400 US stocks with detailed analysis and actionable intelligence.

Investors and market watchers will likely keep a close eye on Expand Energy's stock performance and the natural gas market trends as they evolve in response to the tariff adjustments and their impact on the energy industry's supply and demand dynamics.

In other recent news, Expand Energy has garnered attention with several significant developments. The company exceeded its fourth-quarter 2024 earnings forecasts, reporting an earnings per share (EPS) of $0.55 and revenue of $2 billion, surpassing the anticipated $0.43 EPS and $1.85 billion in revenue. This performance highlights the company's robust operational execution, despite a subsequent stock dip in after-hours trading. Expand Energy is also set to join the S&P 500, replacing FMC Corp (NYSE:FMC), a move that could broaden its investor base and increase liquidity. Analysts have been adjusting their outlooks accordingly, with Benchmark raising its price target to $112 and Mizuho (NYSE:MFG) increasing it to $136, both citing stronger-than-expected gas volumes and favorable market conditions. Mizuho anticipates that the company will exceed first-quarter consensus estimates for EBITDA and cash flow per share. Additionally, Expand Energy plans to increase its production capacity, aiming for 7.1 billion cubic feet per day in 2025 and 7.5 billion cubic feet per day by 2026, supported by strategic investments. These developments indicate a positive trajectory for Expand Energy as it continues to optimize its production and financial strategies amidst a dynamic energy market.

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