Update shared on02 Sep 2025
Fair value Decreased 1.01%Equinor’s consensus price target was revised downward to NOK257.48 amid analyst concerns over weaker commodity prices, constrained growth, rising gearing, and increased valuation risks.
Analyst Commentary
- Bearish analysts point to expectations of lower commodity prices and disappointing earnings for Equinor over the next few years.
- Concerns are raised over limited growth in both oil & gas and low carbon segments, leading to a downbeat outlook for future returns.
- Analysts highlight that rising company gearing may constrain Equinor’s ability to maintain shareholder returns via debt.
- Some bullish analysts previously saw value at higher price targets, citing upward revisions on earlier positive sentiment, though this view has been tempered as price targets were subsequently lowered.
- Valuation risks, including the adequacy of cash return assumptions and relative opportunities in diesel-led refining peers, led to caution and downward revisions across major institutions.
What's in the News
- Equinor will host an Analyst/Investor Day.
- Q2 2025 production rose slightly year-over-year to 2,096 mboe/day (equity) and 1,979 mboe/day (entitlement); power generation increased to 1.12 twh.
- Signed a ten-year deal with BASF for up to 23 TWh of natural gas deliveries annually, starting October 1, 2025.
- Smackover Lithium JV (with Standard Lithium) completed exploration for Phase 1 in Arkansas, finding record lithium concentrations and progressing toward a Final Investment Decision by year-end 2025.
- Submitted plan for Fram Sor development in the North Sea (116 mmboe gross recoverable reserves), with production to start end of 2029; additional exploration targets identified.
- Announced a commercial oil discovery in the Barents Sea (Drivis Tubaen prospect), with estimated recoverable resources of 9-15 mmboe.
- Entered a £20 billion gas supply deal with Centrica to deliver 5 bcm/year to the UK through 2035, supporting UK energy security.
Valuation Changes
Summary of Valuation Changes for Equinor
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from NOK260.80 to NOK257.48.
- The Future P/E for Equinor has significantly risen from 8.85x to 92.38x.
- The Discount Rate for Equinor remained effectively unchanged, at 6.92%.
Disclaimer
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