Valued at $15.9 billion by market cap, EQT Corporation (EQT) operates in the energy sector as a leading natural gas producer in the U.S. Based in Pittsburgh, Pennsylvania, the company specializes in exploring and producing natural gas while providing marketing and pipeline capacity management services.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and EQT fits this criterion perfectly, exceeding the mark. EQT Corporation stands out in the market for its extensive inventory of high-quality drilling locations and status as the only investment-grade company operating in the Appalachian Basin.
However, the energy company has slipped 20.5% from its 52-week high of $45.23, recorded in November last year. Shares of EQT are down 2.7% over the past three months, underperforming the broader S&P 500 Index's ($SPX) 4.7% gains over the same time frame.
Longer term, EQT is down nearly 7% on a YTD basis, lagging behind SPX's 19.9% gains. Moreover, shares of EQT have declined 6.5% over the past 52 weeks, compared to SPX's 32.4% returns over the same time frame.
To confirm the bearish price trend, EQT has been trading below its 50-day and 200-day moving averages since mid-June. But it has climbed above its 50-day moving average since mid-September.
EQT has underperformed due to a combination of persistent low natural gas prices driven by oversupply in the market, rising interest expenses associated with its debt, and overall reduced revenues from its operations, despite the company’s increased production. Moreover, the stock fell 1.7% on Jul. 23 after its Q2 earnings release due to ongoing financial losses, despite a smaller-than-expected loss of $0.08 per share on higher sales volumes. The decline was further exacerbated by concerns about increased competition from Chesapeake Energy's planned merger with Southwestern Energy.
Rival Coterra Energy Inc. (CTRA) has slightly outperformed EQT on a YTD basis, with CTRA declining 6%. But, over the past 52 weeks, shares of Coterra Energy are down nearly 8%, lagging behind EQT.
Despite the stock’s weak price action, analysts are moderately optimistic about EQT’s prospects. The stock has a consensus rating of “Moderate Buy” from the 20 analysts in coverage, and the mean price target of $42.48 is a premium of 18.1% to current levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
