$SM

Seaport Initiates SM Energy at Sell With $35 Price Target

SM Energy (SM) has an average rating of overweight and mean price target of $41.94, according to analysts polled by FactSet.

Williston Rig Count Hits Highest Since October 2025 as Lower 48 Activity Rises, UBS Says

The Williston rig count reached 33, its highest since October 2025, as US Lower 48 activity rose and operators increasingly adopted longer lateral wells, UBS said in a Tuesday note.Williston activity increased by one rig over the week, with the basin's count now 50% above the 22-rig trough reached in mid-February 2026 as higher crude prices supported drilling.Private operators, including Phoenix Operating and Koda Resources, drove much of the recent increase, according to the North Dakota Department of Mineral Resources' monthly update.Among public exploration and production companies, Chord Energy (CHRD) led Williston activity with 4 rigs, while Devon Energy (DVN) and Chevron (CVX) each had three rigs, UBS Evidence Lab data showed.Longer laterals, particularly 4-mile wells, have become a key drilling trend in the basin, with UBS saying the approach can improve capital efficiency and lower supply costs and breakevens.North Dakota's Q2 2026 completions averaged about 13,600 feet in lateral length, up 15% from the state's 2025 average of about 11,800 feet, according to the North Dakota Department of Mineral Resources.Chord Energy had the most visible 4-mile drilling program among public Exploration and Production companies, with such wells accounting for about 40% of its 2026 drilling plan before the company plans to scale the program in 2027.Across the Lower 48, the four-week average active rig count increased 1 rig week-over-week to 620, putting activity 13% above year-end 2025 levels, according to the note.Oil rigs increased 25% from year-end 2025, while gas rigs declined 11% and activity among other rig categories fell materially, UBS said.Permian activity was unchanged overall, as the Delaware added 3 rigs, the Midland lost 2 rigs and other Permian areas declined by 1 rig.Outside the Permian, the Williston Basin, Woodford and Denver-Julesburg each gained 1 rig, while Eagle Ford activity fell by 1 rig.Gas drilling was unchanged in the Haynesville but declined by 1 rig in Appalachia over the week, according to UBS Evidence Lab data.UBS' coverage group and integrated oil companies had 276 active rigs last week, down three from the previous week, with Exxon Mobil (XOM), Occidental Petroleum (OXY), and Murphy Oil (MUR) each adding one rig.Devon Energy, Chevron, SM Energy (SM), California Resources (CRC), Range Resources (RRC) and Gulfport Energy (GPOR) each had 1 fewer rig over the week, potentially reflecting rig movements.Exxon Mobil remained the most active public operator with 35 rigs, followed by Devon Energy with 32, ConocoPhillips (COP) with 30, Occidental Petroleum with 24 and EOG Resources (EOG) with 23, with UBS' coverage group accounting for 45% of Lower 48 active rigs.

SM Energy Keeps Quarterly Dividend at $0.22 a Share, Payable Sept. 21 to Holders of Record Sept. 7

North American E&Ps Boost Exploration, Power Deals as 2027 Plans Take Shape, UBS Says

North American exploration and production companies are stepping up exploration and power investments while reducing debt and preparing for higher shareholder returns, UBS said in a Wednesday note.Liberty Energy (LBRT) expects to sign more than 500 megawatts of power agreements by year-end 2026, with discussions underway with multiple data centers, hyperscalers and industrial users.The company said partnerships with PowerBridge and SLB (SLB) could provide one-stop solutions for potential customers, while project financing could take three to six months after an energy services agreement.Frac pricing continues to improve at Liberty Energy, although oil price volatility leaves the outlook for activity growth uncertain, according to UBS.APA (APA) plans to increase its exploration budget to $250 million to $300 million next year from less than $100 million this year, with a focus on Alaska, Suriname and Uruguay, the note said.Permian efficiency gains continue to emerge at APA, while gas development in Egypt is growing, and shareholder returns are set to increase in the second half of 2026 after the company reduced debt by about $750 million in the first half.Antero Resources (AR) remains on track to reach 4.5 billion cubic feet equivalent per day by year-end 2026 and expects average production of 4.6 Bcfe/d in 2027, UBS said.Antero's margin improvement is underway, with further upside beyond the $300 million outlined through year-end 2028 and confidence in securing additional gas supply agreements, the note added.SM Energy (SM) is nearing a leverage level in the low-1x range that would allow it to ramp up shareholder returns, executives said, as debt reduction and operational gains continue across its four core assets.SM Energy also aims to reduce debt to below about $5 billion and remains confident in its H2 2026 oil outlook. Management sees further savings in lease operating expenses and general and administrative expenses once cost benefits from the Civitas Resources (CIVI) merger are fully realized.Private E&Ps also highlighted growth opportunities across the Anadarko, Bakken, and Powder River Basin, with Anadarko M&A interest remaining strong, and operators citing strong well performance, low decline rates, and excess gas pipeline capacity.The private Bakken producer has expanded into three- and four-mile lateral development, while the private Rockies E&P sees growth potential in the Powder River Basin despite limited development from public E&Ps, UBS said.Price: $19.42, Change: $-0.73, Percent Change: -3.60%

Evolution Petroleum to Buy Midland Basin Mineral, Royalty Interests for $16 Million

Evolution Petroleum agreed to acquire Midland Basin mineral and royalty interests for about $16 million, adding 3,420 net royalty acres to its Permian Basin portfolio, the company said Tuesday.The deal covers interests across Reagan, Upton, Glasscock, Midland and Martin counties in Texas, with Evolution expecting to close the transaction around Aug. 21 and using an Aug. 1 effective date.Evolution plans to fund the acquisition with proceeds from a concurrent common stock offering, cash on hand and borrowings under its revolving credit facility.The acquired interests are expected to generate about $3.9 million in cash flow over the next 12 months, implying a purchase multiple of about 4.1x and a cash flow yield of about 24.6%.The company expects the deal to contribute about 20% of pro forma fiscal 2027 asset cash flow, up from less than 10% in fiscal 2026, while requiring no lifting costs, drilling capital or overhead.At about $4,678 per net royalty acre, the purchase price represents a discount to recently disclosed comparable Permian mineral and royalty transactions, Evolution said. The deal would lift its total M&R holdings to about 9,320 net royalty acres.The acquired interests cover 832 producing wells, seven completed wells, 34 drilled but uncompleted wells, 27 permitted wells and about 1,257 additional locations.Current production stands at about 210 barrels of oil equivalent per day, with 65% liquids and 35% natural gas, while operators include ExxonMobil (XOM), Diamondback Energy (FANG), ConocoPhillips (COP), APA (APA), Crescent Energy (CRGY), Double Eagle and SM Energy (SM).Price: $166.74, Change: $+1.18, Percent Change: +0.71%

Wells Fargo Upgrades SM Energy to Overweight From Equalweight, Adjusts PT to $47 From $32

SM Energy (SM) has an average rating of overweight and mean price target of $41.56, according to analysts polled by FactSet.

US Shale Drillers Adopt Simultaneous Fracking to Cut Well Costs, UBS Says

US shale producers are turning to more advanced hydraulic-fracturing techniques to accelerate completion times and lower well costs, with the efficiency gains expected to extend into 2027, UBS strategists said in a note on Tuesday.UBS analysts said that a broader adoption of simultaneous fracturing, or simulfracs, was a key theme during Q2 earnings season, as producers seek to improve productivity while maintaining capital discipline amid shifting commodity prices.Crescent Energy (CRGY) and SM Energy (SM) in the Uinta Basin reported significant gains after adopting simulfracs.Crescent said it used the technique on all its 2026 Uinta turn-in lines, compared with none in 2025. This has increased completion speeds by about 90% and contributed to a decline of over 15% in well costs on a per-foot basis.SM Energy reported that it more than doubled the efficiency of its Uinta completions quarter-over-quarter in Q2 after switching to simulfracs.The efficiency gains are also being seen among larger producers that have already adopted the technology.Occidental Petroleum (OXY) increased the share of simulfracs in its US onshore completion program to over 45% in 2026, from 10% in 2025.The energy firm cited the approach as one factor behind a 7% year-over-year decline in well costs.Devon Energy (DVN) also plans to expand the use of simulfracs as it applies completion practices developed in its own operations to assets acquired from Coterra Energy (CTRA).Meanwhile, Chord Energy (CHRD) evaluated the use of a trimulfrac in the Williston Basin during the quarter.The energy firm, which began using simulfracs in late 2024, said initial results from the three-well simultaneous completion approach were encouraging, according to UBS.Chord expects trimulfracs could account for between 20% and 50% of its completions in 2027, potentially generating additional cost savings.Meanwhile, the latest UBS data showed the US active rig count averaged 616 on a four-week basis, unchanged from the previous week.The rig activity is up 12% from the end of 2025, driven by a 23% increase in oil-directed rigs. Gas-directed rigs, by contrast, have declined 8% over the same period.The Permian Basin was broadly unchanged week-over-week, with the Delaware adding two rigs, the Midland losing three and other parts of the Permian adding one.Outside the Permian, the Eagle Ford declined by two rigs and the Granite Wash fell by one. The Haynesville lost one gas rig, while Appalachia was unchanged.Energy firms covered by UBS, together with integrated oil and gas producers, operated 256 active rigs last week, up one from the prior week.Antero Resources and California Resources added one rig each, while Devon Energy reduced its count by one, potentially reflecting a rig move.Exxon Mobil (XOM) remained the most active publicly traded operator with 35 rigs, followed by Devon with 33, ConocoPhillips (COP) with 30, and EOG Resources (EOG) and Occidental Petroleum with 23 each.Price: $58.41, Change: $-0.65, Percent Change: -1.10%

Energy Stocks Poised for Gains as Oil, Gas Outlook Improves, UBS Says

UBS maintained its bullish outlook for oil and natural gas, saying it expects 2027 prices to top what the current futures price would suggest even as volatility prompted it to stress-test energy stocks under multiple price scenarios, the bank said in a note on Tuesday.The analysis looked at oil prices ranging from $55-$65 per barrel for Brent crude and corresponding WTI prices of about $51-$61/bbl, along with natural gas prices between $2.75 and $4.25 per million British thermal units.UBS assumed companies would keep spending and production levels unchanged across all scenarios.UBS said current share prices for US oil and gas producers imply investors are expecting WTI crude prices in the low $60s/bbl and natural gas prices of about $3.50/MMBtu in 2027.In a scenario where Brent crude averages $75/bbl and natural gas averages $3.75/MMBtu, UBS believes the sector appears undervalued. Based on historical valuation levels, the bank estimates energy stocks could have over 20% upside.The bank also said energy company valuations are highly sensitive to changes in commodity prices. A $10/bbl move in oil prices and a $0.50 change in natural gas prices would have a significant impact on companies' cash flow and valuations.UBS added that if oil prices fall below $60/bbl and natural gas prices below $3/MMBtu many producers would likely reduce drilling activity and production.Despite higher oil prices since the recent conflict began, energy stocks have lagged the broader market. The S&P 500 Energy Index has gained 8% but has underperformed the broader S&P 500 by about 3 percentage points.Front-month WTI crude prices have risen 22%, while contracts for 2027 delivery are up 15%. Longer-dated natural gas prices, however, have fallen 10%.Among the companies UBS follows, SM Energy (SM) and Chord Energy (CHRD) have posted the strongest gains since the conflict began, while Liberty Energy (LBRT), Comstock Resources (CRK) and Gulfport Energy (GPOR) have been the weakest performers.Smaller and mid-sized oil producers have generally outperformed their larger peers, UBS said.UBS maintained its preferred exploration and production stocks as Ovintiv (OVV), Devon Energy (DVN) and Antero Resources (AR), while naming National Energy Services Reunited (NESR) as its top pick among oilfield services companies.Price: $29.40, Change: $-0.90, Percent Change: -2.97%

Higher Oil Prices Ease SM Energy, Crescent Energy Debt Concerns, Shift Focus to Execution, UBS Says

Higher crude prices have eased investor concerns over debt reduction at SM Energy (SM) and Crescent Energy (CRGY), shifting attention toward acquisition integration and operational execution, UBS said in a Monday note.UBS said its small- and mid-cap oil and gas coverage climbed about 9% on average in July, rebounding from a 21% average decline in the second quarter as West Texas Intermediate crude rose more than 20% amid Middle East tensions.The bank said the 2027 West Texas Intermediate strip has risen more than 8% to above $70 per barrel, strengthening cash flows and supporting deleveraging across much of the sector.Investor feedback following UBS' initiation of coverage on SM Energy and Crescent Energy centered on whether both companies could continue reducing debt if oil prices weaken. UBS said each company can still achieve that goal.UBS said sustained oil-price strength would likely shift investor attention toward execution on recent acquisitions. The bank expects second-quarter earnings to provide updates on operational improvements and synergy gains at both companies.Investors expressed confidence in SM Energy's management team and its plans to increase shareholder returns. Most questions focused on whether the company can lower debt enough to support higher capital returns in a weaker oil-price environment.UBS estimated SM Energy reaches cash-flow neutrality in fiscal 2027 before and after dividends at West Texas Intermediate prices of $49.30/bbl and $52.70/bbl, well below the current 2027 strip of near $71/bbl.Investors also questioned SM Energy's drilling inventory after the Civitas (CIVI) acquisition. UBS estimated reserve life at about 8.6 years following the South Texas sale, below the preferred 10-year level but broadly competitive with peers.UBS said additional appraisal across the Midland Basin, including the Woodford-Barnett interval and Wolfcamp D formation, could expand SM Energy's resource base. The bank also highlighted an 11% increase in 2025 Uinta proved reserves.Investors also sought UBS' view on Crescent Energy's acquisition strategy. The bank expects the company to eventually expand in the Texas Delaware Basin but believes management remains focused on integrating the Vital Energy (VTLE) acquisition and capturing synergies.UBS said investors viewed Crescent Energy's royalty business favorably and supported its estimate of $2.50 to $3.50 per share in equity value for Crescent Royalties.UBS said investors expressed fewer concerns about Crescent Energy's debt than SM Energy's despite both companies carrying leverage of about 2x at the end of the second quarter.Crescent Energy's projected debt of $5.0 billion, versus $6.5 billion for SM Energy, alongside first-quarter synergy capture of more than 120% of target, supports further debt reduction, the bank said.UBS lowered Crescent Energy's projected gas realizations to reflect weaker Waha pricing during the second quarter while raising expected oil realizations.The bank expects SM Energy to expand reserves primarily through discoveries and extensions as it develops acreage across its portfolio, rather than pursuing additional acquisitions to build inventory.UBS said SM Energy continues drilling appraisal and step-out wells across its Midland Basin position and plans to advance secondary bench testing on inherited CIVI acreage, particularly in the Wolfcamp D formation.UBS said SM Energy's integration of its Uinta assets demonstrates its ability to expand reserves organically.After acquiring the assets in 2024, the company increased proved reserves to 110.9 million barrels of oil equivalent at year-end 2025, including 37.3 million boe from discoveries, extensions and positive revisions.The bank expects similar execution on the acquired Permian assets to support future reserve growth and extend inventory.Price: $29.54, Change: $-0.76, Percent Change: -2.51%

Oil Stocks Rise as Middle East Tensions Lift Crude Ahead of Earnings Season, RBC Says

Shares of US oil and gas producers gained over the past week as renewed tensions between Israel and Iran pushed crude prices higher ahead of the Q2 earnings season, RBC Capital Markets analyst Scott Hanold said in a Thursday note.Oil prices climbed to around $80 per barrel for the US benchmark West Texas Intermediate after US President Donald Trump pledged further action against Iran following renewed military strikes.The renewed geopolitical tensions came as the US Strategic Petroleum Reserve fell for the consecutive week to 316.5 million barrels, while inventories at the Cushing, Oklahoma, delivery hub rose above the 20-million-barrel level considered the minimum for efficient operations.Despite the jump in oil prices, trading activity across energy markets remained subdued, Hanold said.Oil-focused exploration and production companies outperformed their natural gas peers over the past week. Shares of oil-weighted producers rose about 3%, while gas-focused companies slipped 1%.The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) gained 4% as crude prices rose about 10%, while US natural gas benchmark Henry Hub prices fell 4%.Investor attention is now shifting toward the upcoming US exploration and production earnings season, with analysts reporting increased discussions around company strategy and capital allocation after limited interest from generalist investors during much of the second quarter.Among the companies drawing the most attention are Expand Energy (EXE), where investors are awaiting the appointment of a new chief executive and Devon Energy (DVN) over potential asset sales.Other companies include EOG Resources' (EOG) exploration activities in the UAE, Matador Resources' (MTDR) efforts to unlock value from its midstream assets, California Resources' (CRC) strategic initiatives, and EQT's (EQT) growth plans.Analysts said investors are also focused on the potential for mergers and acquisitions, free cash flow allocation and the outlook for US natural gas markets, with EOG, Matador, SM Energy (SM) and EQT emerging as favored names heading into earnings.Price: $168.11, Change: $+1.67, Percent Change: +1.00%

Roth Capital Partners Upgrades SM Energy to Buy From Neutral, Adjusts PT to $32 From $30

SM Energy (SM) has an average rating of overweight and mean price target of $42.20, according to analysts polled by FactSet.

SM Energy Seen Beating Oil Production Expectations, TPH Energy Says

SM Energy (SM) could produce more oil than previously expected through the rest of the year, even as recent asset transactions complicate comparisons in the company's near-term financial results, TPH Energy Research analyst Oliver Huang said in a Friday note.Huang said the independent US oil and gas producer appears positioned to outperform both company guidance and Wall Street expectations on oil production in the coming quarters.The forecast comes after SM Energy completed several portfolio changes, including a partial acquisition tied to Civitas Resources earlier this year and the sale of certain natural gas-focused South Texas assets at the end of April.Despite those moving pieces, TPH estimates Q1 oil production at about 238,500 barrels per day, above the company's guidance range of 228,000 b/d to 235,000 b/d and slightly ahead of broader analyst expectations.For the second half of 2026, the firm expects oil output to average roughly 240,000 b/d, modestly above both company guidance and consensus estimates.TPH also expects SM Energy's capital spending to land toward the high end of its projected annual range as the company continues development activity.The research firm said additional asset sales aimed at reducing debt could serve as a catalyst for the shares. SM Energy is viewed by investors as a company with significant exposure to oil prices because of its relatively high leverage and large crude oil production base, making the stock more sensitive to swings in oil markets.The company's shares have outperformed since oil prices strengthened amid geopolitical tensions and war-related disruptions, supported by what TPH described as a strong first-quarter performance.TPH maintained a "Hold" rating on the stock with a $38 price target.Price: $30.53, Change: $-0.63, Percent Change: -2.02%

SM Energy to Pay Quarterly Dividend of $0.22 per Share, Payable June 22 to Shareholders of Record June 8

Raymond James Upgrades SM Energy to Outperform From Underperform, Price Target is $55

SM Energy (SM) has an average rating of overweight and mean price target of $41.73, according to analysts polled by FactSet.

SM Energy Gains Momentum on Civitas Merger, RBC Says

SM Energy (SM) is seeing its integration of Civitas execute ahead of plan, with stronger production and a favorable commodity price environment helping the company reduce debt and accelerate share buybacks, RBC Capital Markets said in a Friday note.RBC said SM Energy produced 371 thousand barrels of oil equivalent per day, or Mboe/d, in Q1, just two months operating as a combined company. That came in 6% above the midpoint of guidance.Capital spending was 12% below plan at $672 million, while management raised its full-year production midpoint to about 420 Mboe/d, the firm said.RBC said the faster-than-expected integration supports a higher free cash flow profile as one-time integration costs begin to fade.Analysts also noted SM Energy has "an attractive value proposition" and a significant upside potential with a positive rate of change.RBC maintained its sector perform rating on SM Energy and $40 price target.Price: $33.40, Change: $+0.81, Percent Change: +2.49%

SM Energy Q1 Production Jumps Following Civitas Merger, Raises 2026 Outlook

SM Energy Company (SM) reported Q1 earnings on Wednesday, showing net production volumes of 33.4 million barrels of oil equivalent, up from 17.8 mmboe a year earlier following the Civitas Resources merger.Oil production volumes increased to 17.1 mmbbl for the quarter ended March 31, up from 9.3 mmbbl a year earlier.Natural gas production climbed to 72.4 billion cubic feet for the quarter from 36.4 Bcf a year earlier.Natural gas liquids production rose to 4.2 mmbbl for Q1, compared with 2.4 mmbbl a year earlier.SM Energy completed its merger with Civitas Resources on Jan. 30, 2026, adding Permian and DJ Basin assets.SM Energy raised its full-year 2026 production guidance to 150 mmboe to 157 mmboe and an average daily total production of 410,000 boe per day to 430,000 boe/d.SM Energy maintained its 2026 capital expenditure plan at $2.65 billion to $2.85 billion and expects to drill about 245 net wells during the year.SM Energy completed the $950 million sale of certain South Texas assets on Apr. 30 and plans to use about $900 million of net proceeds to retire outstanding 2026 senior notes.Price: $27.50, Change: $-1.08, Percent Change: -3.78%

SM Energy Q1 Adjusted Earnings Fall, Revenue Rises

SM Energy (SM) reported Q1 adjusted earnings late Wednesday of $1.55 per diluted share, down from $1.76 a year earlier.Analysts polled by FactSet expected $1.12.Revenue for the three months ended March 31 was $1.48 billion, up from $845 million a year earlier.Analysts surveyed by FactSet expected $1.42 billion.