Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 26 Mar, 26 | NFG | Buy | USD 94.4 | USD 99.0 | USD 104.5 | 35 days | Closed |
8.90%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
National Fuel Gas Company operates as a diversified energy company. It operates through four segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. The Exploration and Production segment explores for, develops, and produces natural gas and oil. The Pipeline and Storage segment provides interstate natural gas transportation services through an integrated gas pipeline system in Pennsylvania and New York; and owns and operates underground natural gas storage fields. This segment also transports natural gas for National Fuel Gas Distribution Corporation, as well as for other utilities, industrial companies, and power producers in New York State. The Gathering segment builds, owns, and operates natural gas processing and pipeline gathering facilities in the Appalachian region, as well as provides gathering services to Seneca. The Utility segment sells natural gas or provides natural gas utility services to various customers in Buffalo, Niagara Falls, and Jamestown, New York; and Erie and Sharon, Pennsylvania. National Fuel Gas Company was incorporated in 1902 and is headquartered in Williamsville, New York.
Production Growth Driving Volume Expansion: Natural gas production increased to Q1FY26 109 Bcf from Q1FY25 98 Bcf, representing a 12% rise supported by new well additions
Strong EPS Growth Momentum: Adjusted EPS increased to Q1FY26 USD 2.06 compared to Q1FY25 USD 1.66, reflecting a 24% rise driven by operational strength and higher margins
Pipeline Segment Earnings Decline: Pipeline earnings declined to Q1FY26 USD 31.2 million from Q1FY25 USD 32.5 million, reflecting weaker contribution from non-operating income
Rising Operating Cost per Unit: Total operating costs increased to Q1FY26 USD 1.27 per Mcf compared to Q1FY25 USD 1.24 per Mcf, indicating cost inflation pressures
The company’s performance remains highly sensitive to volatility in natural gas prices and regulatory approvals, where fluctuations in commodity pricing or delays in infrastructure and acquisition execution could materially impact earnings and cash flow generation
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 94.4 | 86.0 | 99.0 | 104.5 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Strong Earnings Growth and Improved Profitability: National Fuel Gas Company delivered a robust start to fiscal 2026, reporting adjusted earnings of USD 187.7 million in Q1FY26 compared to USD 151.9 million in Q1FY25, reflecting a 24% increase. Adjusted earnings per share rose to USD 2.06 from USD 1.66 in the prior-year period, supported by improved operational performance across core segments. GAAP earnings also increased significantly to USD 181.6 million from USD 45.0 million, primarily aided by the absence of prior-year impairment charges.
Upstream Growth Driven by Production and Price Realizations: The Integrated Upstream and Gathering segment remained the primary growth engine, with adjusted earnings increasing by USD 38.8 million year-over-year. Natural gas production rose to 109 Bcf in Q1FY26 from 98 Bcf in Q1FY25, marking a 12% increase, driven by new Utica wells in Tioga County. Additionally, realized gas prices improved to USD 2.89 per Mcf from USD 2.53 per Mcf, supported by stronger NYMEX pricing and hedging gains.
Margin Expansion Supported by Higher EBITDA: Operational leverage translated into meaningful margin expansion, with segment adjusted EBITDA rising to USD 268.4 million in Q1FY26 from USD 208.6 million in Q1FY25. This reflects improved production mix and favorable commodity pricing, reinforcing the strength of the company’s integrated upstream model.
Utility Segment Stability with Moderate Growth: The Utility segment delivered steady performance, with net income increasing by 5% year-over-year. Earnings growth was driven by a USD 9.8 million increase in customer margin, supported by rate adjustments in New York, colder weather conditions, and contributions from modernization programs.
Pipeline Segment Earnings Moderation: The Pipeline and Storage segment reported a marginal decline in earnings, with GAAP income decreasing to USD 31.2 million in Q1FY26 from USD 32.5 million in Q1FY25. The decline was primarily attributed to lower intercompany interest income, while core operating revenues and expenses remained broadly stable.
Cost Pressures and Operating Expense Trends: Despite revenue growth, cost pressures emerged during the quarter. Total operating costs increased to USD 1.27 per Mcf in Q1FY26 from USD 1.24 per Mcf in Q1FY25, driven by higher lease operating expenses and third-party gathering costs. Additionally, depreciation and maintenance-related expenses increased due to asset base expansion.
Capital Allocation and Strategic Positioning: The company continued to invest in long-term growth, including pipeline expansion projects and the pending Ohio utility acquisition. A USD 350 million equity issuance strengthened the balance sheet to support this transaction. Management reaffirmed FY26 adjusted EPS guidance of USD 7.60 to USD 8.10, indicating confidence in sustained earnings momentum.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given to National Fuel Gas Company (NYSE: NFG) at the closing market price of USD 94.40, as on Mar 25, 2026
Data Powered by EOD Historical Data (“EODHD”).
Sector: Energy Industry: Oil & Gas Integrated
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| NFG National Fuel Gas Company |
-0.24 0.30% | 80.92 | 9.82 | 8.61 | 2.11 | 1.55 | 3.31 | 6.09 |
| XOM Exxon Mobil Corp |
2.29 1.54% | 150.65 | 10.10 | 10.45 | 1.16 | 2.03 | 1.19 | 5.18 |
| CVX Chevron Corp |
0.41 0.22% | 190.12 | 27.63 | 19.38 | 2.01 | 1.99 | 2.20 | 9.78 |
| SHEL Shell PLC ADR |
0.61 0.71% | 86.81 | 7.88 | 7.53 | 0.63 | 1.11 | 0.75 | 3.33 |
| RYDAF Shell PLC |
0.13 0.30% | 43.18 | 7.66 | 7.35 | 0.62 | 1.09 | 0.74 | 3.27 |
Data Powered by EOD Historical Data (“EODHD”).
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on March 26, 2026. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned has been achieved and is subject to the factors discussed above.
Note 4: StockNextt reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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