Summary
Gulfport reported modest 2025 results. Reserves showed a modest increase. Q4 production was slightly below expectation. Long-term production has limited potential for growth. The balance sheet is very healthy. Q4 profit was slightly above my expectation. The FCF is healthy and well capable of paying down existing senior notes and credit facilities. Shareholder returns are generous. Gulfport in my 80-company ranking sits in the top 25 at a high 11th position.
Reserves
• Gulfport reserves have not shown any significant growth over the last seven years. Reserves varied around levels close to 4.0-4.3 tcf.
• 2025 reserves (4.253 tcfe) were 7.3% above 2024 (3.969 tcfe), with bookings in the northern part of the Marcellus shale.
• The 2025 reserves (4.253 tcfe) are equivalent 11.0 years of 2026 production. This is above the industry average (9.0-9.5 years).
• The Reserves Replacement Ratio (RRR) over the last seven years was a modest 0.87, not fully replacing the volumes produced.
• The 2025 RRR was a good 1.85.
• The proven reserves and the RRR indicate that there is potential for some limited production growth.
• Gulfport has indicated it is looking for small acquisitions of $ 75-100 M by late Q1 2026 in order to expand the drilling inventory by 1-2 years.
- Gulfport reserves.jpg (118.2 KiB) Viewed 43 times
Production
• Since it came out of Chapter 11 in 2021, Gulfport production has been held in a tight range of 950-1,050 MM scfe/d. There were no indications of any substantial production growth.
• Q4 production (1,097 MM scfe/d) was below the Q3 production of 1,120 M scfe/d. Gulfport did not provide a Q4 outlook. I had expected a production of 1,150 MM scfe/d.
• 2025 production (1,039 MM scfe/d) was at the bottom of the Gulfport 2025 guidance of 1,040-1,065 MM scfe/d.
• In 2026 production should stay close 2025 levels with a limited potential for growth, although Gulfport claims it has 500 drilling locations equivalent to 15 years of drilling.
• Gulfport 2026 outlook is 1,030-1,055 MM scfe/d. I am expecting a production of 1,050 MM scfe/d.
- Gulfport production.jpg (147.16 KiB) Viewed 43 times
• Gulfport has been focused in 2025 on trying to get the liquid production to grow faster than the gas production. The liquid share of the production increased in 2025 from 9.2% (Q4 2024) to 10.0% (Q4 2025). For 2026 Gulfport targets a liquid share of 10.2-11.9%.
Balance sheet
• Gulfport has a healthy balance sheet.
• Coming out of Chapter 11, the balance sheet no doubt has received continuously a lot of attention from management.
• The equity ratio (=equity/balance sheet total) decreased from a 62.5% (Q3) to still good 60.6% (Q4).
• Long-term debt increased with $ 96 M from $ 692 M (Q3) to $ 788 M (Q4).
• The Q4 debt/EBITDA ratio on an annual basis was a good 0.6. With higher gas prices in 2026 the debt EBITDA ratio can fall to healthy levels of 0.7 .
• The balance sheet allows generous shareholder returns.
Profitability
• Gulfport is a profitable company.
• Q4 profits (eps=$ 5.81) were above Q3 profits (eps=$ 4.98), mainly due the higher gas prices. I had expected an eps in Q4 of $ 5.52.
• Q4 realized gas prices ($ 3.27/MM Btu) were lower than I had expected ($ 3.49/MM Btu), but were well up versus Q3 ($ 2.61/MM Btu).
• Operational costs were close to expectations.
• With almost no oil content, profits are independent of oil prices.
• For 2026, with Henry Hub at $ 3.78/MM Btu, I expect an eps (excluding non-cash hedging) of $ 22.92 (PE=9.1).
• After 2026 the eps can fall. By 2030 with lower gas prices ($ 3.56/MM Btu) the eps can fall back to $ 18.70 (PE= 11.1).
- Gulfport profit.jpg (100.01 KiB) Viewed 43 times
• Gulfport will be generating significant amounts of FCF, also under lower oil prices.
• Gulfport has to repay $ 50 M on a credit facility in 2028, and $ 650 M of 6.75% unsecured notes in 2029. There are no scheduled debt repayments in the period 2026-2027 and in 2030.
• The FCF should be adequate to repay the debts.
• Of course there is no need for cash for the notes in 2029. The 2029 notes can be rolled over into new notes with a later maturation date.
Shareholder returns
• Gulfport does not pay dividends, but buys back shares.
• Gulfport bought back in H2 all (=36.4 M) preferred stock.
• Gulfport bought back common shares for $ 58 M (Q1), $ 52 M (Q2), $ 44 M in Q3 and $ 127 M in Q4 for a 2025 total of $ 289 M.
• The share buybacks resulted in a high 2025 shareholder return of 7.0%.
• In 2026 I expect that shareholder return will be near 2025 levels.
Conclusions
Gulfport reported modest 2025 results. Reserves showed a modest increase. Q4 production was slightly below expectation. Long-term production has limited potential for growth. The balance sheet is very healthy. Q4 profit was slightly above my expectation. The FCF is healthy and well capable of paying down existing senior notes and credit facilities. Shareholder returns are generous. Gulfport in my 80-company ranking sits in the top 25 at a high 11th position.