Narrative Update: SM Energy Analyst Price Target Adjustment
Analysts have revised SM Energy’s fair value estimate downward from $40.00 to $38.62 per share. This adjustment is due to more conservative revenue growth assumptions, which are partially offset by improved profit margin projections and a lower future price-to-earnings ratio.
What's in the News
- Civitas Resources is in discussions to merge with SM Energy in a potential merger of equals valued at over $14 billion, including debt. Both companies operate across key U.S. shale basins (Bloomberg).
- CEO Herbert S. Vogel announced his plan to retire in March 2026. Elizabeth A. McDonald is expected to be promoted to President and CEO at that time.
- SM Energy reported strong production growth for the second quarter of 2025, with average net daily oil production rising to 115.7 MBbl from 72.7 MBbl a year ago.
- The company updated its 2025 production guidance, raising the expected oil share of total production to 53% to 54% from previous estimates of 51% to 52%.
Valuation Changes
- Consensus Analyst Price Target has decreased from $40.00 to $38.62 per share.
- The Discount Rate has declined slightly from 8.34% to 8.29%.
- The Revenue Growth projection has fallen significantly from 5.67% to 3.71%.
- Net Profit Margin has increased from 15.53% to 18.13%.
- The future P/E ratio estimate has dropped from 10.72x to 9.37x.
Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.