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Investing.com - Wolfe Research has reiterated an Underperform rating on Expand Energy (NASDAQ:EXE) while slightly lowering its price target to $148.00 from $150.00 per share. According to InvestingPro data, the company’s stock has shown strong momentum with a 37% return over the past year, despite trading at high EBITDA and revenue multiples.
The price target reduction reflects adjustments based on marking the lower forward curve, according to Wolfe Research’s latest analysis of the natural gas market.
Despite the Underperform rating, Wolfe Research maintains that U.S. gas markets will tighten in 2026 as the pace of liquefied natural gas (LNG) additions increases to meet demand.
The firm characterizes market recognition of changing U.S. gas dynamics as a "6th inning play," with the next phase of Expand Energy’s investment case defined by the transfer of value from debt to equity, noting that 25% of the company’s capital structure is net debt.
Wolfe Research identifies the next eight weeks as critical for determining the magnitude of "peak gas" in 2026, pointing out that the January 2026 strip has softened to $4.80/mcf, compared to $5.23/mcf in mid-June and a recent peak above $5.70/mcf in March.
In other recent news, several investment firms have adjusted their price targets for Expand Energy, reflecting optimism about the company’s future performance. UBS raised its price target to $145 while maintaining a Buy rating, citing the company’s strategic positioning to benefit from rising natural gas prices and its plans to increase production and shareholder returns. Mizuho (NYSE:MFG) also increased its price target to $142, maintaining an Outperform rating, although it noted potential misses in second-quarter 2025 EBITDAX and cash flow estimates due to softer pricing. Citi raised its target to $140, highlighting production growth stability and positive long-term commodity fundamentals, while suggesting that capital expenditures might exceed market expectations.
KeyBanc set a new price target of $135, emphasizing a "cash return inflection" and confidence in Expand Energy’s mid-teens return on equity. Piper Sandler increased its target to $139, pointing to strong well productivity and the company’s potential to capitalize on growing LNG export capacity. Piper Sandler’s Mark Lear (NYSE:LEA) noted that despite Expand Energy’s advantages, it trades at a discount compared to its peers, a situation he sees as unwarranted given the company’s capabilities. These adjustments reflect a broader recognition of Expand Energy’s potential to leverage its diverse portfolio and respond to demand trends in the natural gas market.
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