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Research Alert: CFRA Keeps Hold Opinion On Shares Of Apa Corporation

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

Our 12-month target price of $39, raised $4, reflects a 3.5x multiple of enterprise value to projected 2027 EBITDA. The applied multiple is slightly above APA's historical forward average, but we now think a premium multiple is defensible given the recent surge in crude oil prices following the onset of war between the U.S. and Iran. If the recent commodity price increase is sustained, it should do wonders for APA's cash flows and probably hasten efforts to clean up its balance sheet. On the latter point, per our DCF model, the company has little near-term demands on cash flows until 2029 (beyond dividend payments) when debt milestones appear. However, we only find them particularly onerous in 2030. We think APA is giving itself room for M&A to boost a low reserve life, if opportunities present themselves. We lift our 2026 EPS estimate by $3.41 to $6.08 and 2027's by $1.54 to $4.24.

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