Freedom Broker cuts Expand Energy stock price target on higher capex outlook

Freedom Broker has reduced its price target on Expand Energy (NASDAQ:EXE) stock from $122 to $113, maintaining a Buy rating. The lower target was based on the company's increased capital expenditure outlook and revised commodity price assumptions. The analysis noted management narrowed fiscal 2026 production guidance while keeping the midpoint unchanged and raising the capital budget due to weaker capital efficiency.

Expand Energy completed the acquisition of Twin Eagle on September 16 and appointed Daniel E. Brown as permanent CEO, ending an interim period. Despite these changes, the company's third-quarter results exceeded expectations with revenue and adjusted earnings per share surpassing consensus estimates by 15.5% and 12.6%, respectively.

Expansion Energy's strong performance earned it a perfect Piotroski Score of 9 and a P/E ratio of 7.84, trading at a market cap of $21 billion. The stock's undervaluation was attributed to realized price gains from hedging and not stronger market prices. Expansion Energy's net debt increased due to funding for the Twin Eagle acquisition, while share repurchases slowed and the quarterly dividend remained unchanged.

The company's valuation now reflects the higher capital expenditure outlook, acquisition impact, and updated commodity prices.