On Thursday, Mizuho Securities adjusted its outlook on CNX Resources (NYSE:CNX), increasing the stock's price target to $25 from $24 while maintaining a neutral stance on the company's shares. The firm anticipates that the first-quarter results for 2024 will align with the company's established trajectory, noting there should be no unexpected developments.
The earnings call is expected to concentrate on CNX Resources' production schedule for the year, especially after the company postponed certain well completions (TILs) in the first quarter of 2024.
Analysts are keen to hear management's perspective on achieving the previously forecasted production volume of approximately 580 billion cubic feet equivalent (bcfe) in 2025. This is in light of the company's reduced capital expenditure for 2024, which is approximately $50 million less than initially budgeted.
Mizuho has based its revised price target on a net asset value (NAV) approach, which reflects the intrinsic value of the company's assets. The increase in the price target to $25 represents a modest uplift from the previous target of $24. The neutral rating suggests that the firm views the stock as fairly valued at its current price, considering the company's financial outlook and market conditions.
The analysis also indicates that the upcoming quarterly earnings call may provide additional insights into CNX Resources' strategic plans. Investors and stakeholders will be looking for updates on the company's operational strategy and how it plans to navigate the expected lower activity level in 2024.
In summary, Mizuho's updated price target for CNX Resources is a reflection of the company's steady progress and the expectation of meeting its long-term production goals. The neutral rating indicates a balanced view on the stock's potential for price movement.
InvestingPro Insights
As CNX Resources (NYSE:CNX) approaches its earnings call, real-time data and insights from InvestingPro can provide investors with a deeper understanding of the stock's potential. With a market capitalization of $4.44 billion and a notably low P/E ratio of 2.32, the company stands out for its valuation metrics. The adjusted P/E ratio for the last twelve months as of Q4 2023 is similarly low at 2.31, highlighting the stock's affordability relative to earnings. Additionally, the price to book ratio is under 1, at 0.86, which could suggest that the stock is undervalued based on its assets.
InvestingPro Tips highlight that management has been actively buying back shares, which may be a sign of internal confidence in the company's value. It's also worth noting that analysts predict CNX Resources will be profitable this year, with the company having been profitable over the last twelve months. These factors, combined with a strong return over the last three months of 21.63%, position CNX Resources as a company with solid recent performance. For those seeking more insights, InvestingPro offers additional tips on CNX Resources; using the coupon code PRONEWS24 can get investors an extra 10% off a yearly or biyearly Pro and Pro+ subscription.
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