EQT Corp (EQT) Update by RBC Capital

[dan_s]

October 13, 2023
EQT Corporation
Model Update For New Price Deck, Dividend Raise, and Hedge Settlements

Our view: We are updating our 2023-2025 estimates to reflect RBC's recent
commodity price update and EQT's hedge settlement. Our 3Q23 EPS/CFPS
estimates are raised by $0.04/$0.05 to ($0.16)/$0.92 reflecting higher than
modeled hedge gains.

RBC's Price Target remains at $48.00

Key points:

Dividend increase and 3Q23 settled derivatives. EQT declared a quarterly
cash dividend of $0.1575/share, payable in 4Q23. This is a 5% increase to
the prior cash dividend, which now amounts to an annual $0.63/share, or
a 1.4% annualized yield. EQT also reported a net cash settled hedge gain
that includes NYMEX hedges, basis hedges, and deferred premium costs
totaling $191 million, above our $125 million estimate.

Summary of price deck changes (full note). Our 4Q23 HH/WTI forecasts
increase by $0.25/$9.03 to $3.00/Mcf and $86.50/Bbl. Our 2024 HH
forecast was unchanged at $3.50/Mcf, while our WTI expectation increased
by $5.10 to $86.45/Bbl. Our 2025 price assumptions with $3.75/Mcf for HH
and $77/Bbl for WTI.

[dan_s]

My valuation increases by $0.50 to $47.50.
> Higher ngas prices for Q3 and Q4.
> Small tweaks to a few line items to get closer to the expenses and realize prices that RBC Capital has in their model.

A year from now EQT will be drawing a lot more attention.