EQT Corp. (EQT) Valuation Update - April 25

[dan_s]

I have finished updating my forecast/valuation model for EQT for Q1 2025 results and their updated guidance.

At the time of this post EQT was trading for $50.12. My updated current valuation is $65.00.

EQT is a large-cap "Gasser" and it is the most heavily weighted to natural gas (~94% of production).
> EQT's Q1 realized natural gas price, net of differential and cash settlements on their hedges was $3.66/mcf. < They actually paid out $92 million for cash settlements on their hedges in Q1.
> For the remainder of 2025, I am forecasting realized natural gas prices of $3.19 for Q2, $3.61 for Q3 and $4.28 for Q4.
> ~65% of their Q2 2025 natural gas is hedged at $3.11 to $3.48, so the recent dip in gas prices won't have much impact on Q2 results.
> Over 50% of their Q3 and Q4 gas is hedged.
> EQT is going to generate over $3 billion of free cash flow this year. < Over $5/share.

TipRanks: "In the last 3 months, 20 ranked analysts set 12-month price targets for EQT. The average price target among the analysts is $57.39." The 5 most recent updates since EQT announced Q1 results range from $46 to $74.

EIA's current forecast for U.S. natural gas price for 2026 is $4.60/MMBtu. If gas price do average that high next year, EQT should generate close to $5 billion ($12.50/share) of free cash flow from operations next year and some of the Wall Street Gang's price targets will go over $100.

If you are bullish on U.S. natural gas prices, EQT should be one of your Core Holdings. Downside risk is minimal due to EQT's hedging program.