EQT Corp (EQT) Update - Jan 31

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dan_s
Posts: 34471
Joined: Fri Apr 23, 2010 8:22 am

EQT Corp (EQT) Update - Jan 31

Post by dan_s »

If you have a long-term bullish outlook for natural gas prices then you should have EQT in your portfolio. It is America's largest natural gas producer, with production over 5.4 Bcfe per day now and heading to 5.6 Bcfe per day by year end. 99% of EQT's production is natural gas and NGLs; all from Appalachia.

EQT closed at $32.66 today. My updated valuation is $50.00 based on 4.5 X annualized operating cash flow per share.

TipRanks: "In the last 3 months, 13 ranked analysts set 12-month price targets for EQT. The average price target among the analysts is $51.67. The 13 price targets range from $40 to $78 per share."

For 2023, I forecast that EQT's realized natural gas price will be $3.60/mcf, net of cash settlements on their hedges and differentials.

EQT generated over $2 billion of free cash flow in 2022 and they should generate more than $2.4 billion FCF in 2023.

It pays a small dividend and is using FCF to fund an aggressive stock repurchase program. The balance sheet is in good shape and they have zero near-term debt problems.
Dan Steffens
Energy Prospectus Group
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