SM Energy Q3 profit misses on operational downtime

Overview

• U.S. oil and gas producer's Q3 adjusted EPS missed analyst expectations

• Company returned $133 mln to shareholders and redeemed $417 mln in debt in Q3

• Q3 oil production affected by downtime and takeaway constraints, prompting lower full-year oil guidance

Outlook

• Company lowers full-year 2026 oil production guidance to 220-222 MBbl/d

• Company narrows full-year 2026 total production guidance to 420-422 MBoe/d

• SM Energy expects 2026 capital expenditures of about $2.75 bln

Result Drivers

• MERGER SYNERGIES - Co said merger integration delivered higher-than-expected cost and operational synergies

• OPERATIONAL DOWNTIME - Co cited higher-than-planned downtime in the Permian Basin and takeaway constraints in the Uinta Basin as factors reducing oil volumes

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 6 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the oil & gas exploration and production peer group is "buy"

• Wall Street's median 12-month price target for SM Energy Co is $43.88, about 17.2% above its November 2 closing price of $37.44

• The stock recently traded at 4 times the next 12-month earnings vs. a P/E of 5 three months ago

Reuters Recommended Reads

• Nov 2 - Diamondback Energy Q3 revenue beats on higher oil output

• Nov 2 - Valaris Ltd Q3 revenue rises 10% on drillship contracts

• Nov 2 - Allison Transmission Q3 sales jump 121%, beat estimates

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)