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On Wednesday, UBS analyst Josh Silverstein adjusted the price target for Range Resources (NYSE:RRC) stock, raising it to $37.00 from the previous $36.00, while retaining a Neutral rating on the shares. The company, currently valued at $7.4 billion, has seen its stock decline by 21% in the past week. Silverstein's analysis anticipates a significant reduction in the company's net debt, which is expected to fall below $1 billion in the first half of 2025. This decrease is projected to facilitate an increase in returns to shareholders in the latter half of the year. According to InvestingPro data, nine analysts have recently revised their earnings estimates upward for the upcoming period, suggesting growing confidence in the company's prospects.
The analyst underscored the forthcoming first-quarter results, due on April 29, noting the importance of Range Resources reaching a pivotal moment in improving its balance sheet. The anticipated drop in net debt is seen as a precursor to enhanced shareholder returns slated for the second half of 2025. With a current debt-to-equity ratio of 0.46 and operating with moderate leverage, the company appears well-positioned for its debt reduction strategy. Silverstein's commentary also highlighted the upcoming updates on the company's growth plans for the years 2026 to 2027 as critical elements that will be addressed in the company's forthcoming communications. For deeper insights into Range Resources' financial health and detailed metrics, investors can access the comprehensive Pro Research Report available on InvestingPro.
Range Resources' allocation of free cash flow (FCF) is set to undergo a transformation, with a portion being redirected towards shareholder returns. This strategic reallocation is closely tied to the company's debt reduction and financial health. Moreover, the analyst is looking forward to another robust operational quarter from Range Resources and is keen on updates regarding natural gas liquids (NGL) pricing. The company's exposure to NGL export markets and the growing concerns over demand fluctuations in China are particularly noteworthy in the context of global market dynamics.
The company's financial strategy and operational performance are under close watch as industry observers await further details on how Range Resources will navigate the current economic landscape. The slight increase in the price target reflects a cautiously optimistic view of the company's ability to manage its finances and capitalize on its market position amidst variable global demand.
In other recent news, Range Resources Corporation has seen multiple developments that may interest investors. Benchmark analysts maintained a Hold rating for the company, projecting an earnings per share (EPS) of $0.92 for the first quarter, surpassing the consensus EPS of $0.90. Morgan Stanley (NYSE:MS) upgraded the company's stock rating from Underweight to Equalweight, raising the price target to $49, citing Range Resources' capital-efficient production growth and increased production volumes by 2027. Roth/MKM analysts also upgraded the stock to Buy, adjusting the price target to $42, reflecting a positive outlook on natural gas exploration and production companies. Meanwhile, Mizuho (NYSE:MFG) Securities lowered its price target for Range Resources to $45 but maintained an Outperform rating, emphasizing the company's robust financial health.
Moody's Ratings upgraded Range Resources' Corporate Family Rating to Ba1 from Ba2, highlighting the company's solid operational performance and ability to generate free cash flow even in low gas price environments. The stable outlook reflects Range Resources' commitment to conservative financial policies and improved leverage. Analysts at Benchmark attribute their higher forecast to favorable post-hedge gas realizations, which are expected to drive financial performance above consensus estimates. These updates indicate a range of perspectives from various analysts, each pointing to different aspects of Range Resources' financial and operational strategies.
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