Range Resources (RRC) Valuation Update - Feb 27

[dan_s]

At the time of this post RRC was trading at $36.68.

I have updated my forecast/valuation model for Range's Q4 results and 2025 guidance.
My current valuation increases by $1 to $45, primarily due the increased natural gas prices I am now using for 2025.

TipRanks: "In the last 3 months, 21 ranked analysts set 12-month price targets for RRC. The average price target among the analysts is $41.32." < 11 of the 21 price targets have been updated since RRC released Q4 results. The fresh 11 price targets range from $32 to $47 with an average price target of $41.82.

For 2025 Range's drilling program remains in "maintenance mode" because they don't have enough pipeline access to increase production. As a result of low capex and higher revenues, Range is going to generate a lot more free cash flow this year; more than doubling FCF YOY to close to $1 Billion.

Since Range's balance sheet is already in good shape, I expect them to increase their dividends and stock buybacks.

Range is one of the four "Gassers" in our Sweet 16 with a production mix of approximately 69% natural gas, 29% NGLs and just 2% oil.