Raymond James reiterated a Market Perform rating on CNX Resources (NYSE:CNX) after the company published fourth-quarter 2025 results and issued guidance for fiscal 2026. The stock was trading near its 52-week high at $40.27, with that high recorded at $42.13.
CNX established production guidance for fiscal 2026 that calls for essentially flat volumes across the year, centering on a midpoint of roughly 612 million cubic feet equivalent (mmcfe) with liquids comprising 7.5% of the mix. Raymond James noted that this production outlook aligns with both its own projections and the consensus on the Street. Data cited from InvestingPro characterizes the company as profitable over the trailing twelve months and assigns a "GREAT" overall financial health score.
Capital spending guidance sits at a midpoint of $571 million for fiscal 2026, which Raymond James described as consistent with analyst expectations. Management indicated that roughly 60% of that spending is slated for the first half of the year. Operational plans include running about 1.5 rigs and a partial-year fracturing crew as CNX balances development across its inventory.
Management reiterated that the company will continue its dual development approach - harvesting inventory in the Marcellus while deepening technical and operational work in the deeper Utica play. The company has also been an active participant in share repurchases, a strategy management has pursued aggressively according to InvestingPro data, a sign the leadership team may be expressing confidence in their capital allocation and operational plan.
On profitability, Raymond James projects adjusted EBITDA for fiscal 2026 of approximately $1.33 billion, matching the midpoint of CNX's guidance. For context, the company's last twelve months of EBITDA were reported at $1.47 billion, as noted in the data referenced by Raymond James.
Despite solid near-term cash generation and recent strong quarterly results, Raymond James pointed to valuation pressure tied to CNX's hedge position for fiscal 2026. The firm estimates the company trades at about a 7% free cash flow to enterprise value yield based on 2026 estimates - a level below some gas-focused peers. A key driver of that relative discount is an unfavorable hedge book; management has hedged 81% of natural gas volumes for fiscal 2026 at an average price of $2.78 per thousand cubic feet.
InvestingPro analysis included in the review indicates alternative valuation signals. Based on InvestingPro's Fair Value assessment, CNX is currently flagged as undervalued, with a present free cash flow yield of 9% and an EV/EBITDA multiple of 5.69. The platform also offers an in-depth Pro Research Report on CNX as part of its library of company analyses.
Separately, CNX posted fourth-quarter 2025 operational and financial results that exceeded consensus. The company reported earnings per share of $1.28, well above the expected $0.35, representing a surprise of 265.71%. Revenue for the quarter came in at $610.48 million versus an expected $432.28 million, a beat of 41.22%. Raymond James and market observers will likely factor these stronger-than-anticipated quarterly metrics into future assessments of CNX's performance.
The combination of steady production guidance, front-loaded capital spending, hedging coverage at modest prices, and aggressive buybacks informs Raymond James' decision to maintain a Market Perform stance. The firm appears to balance the company's demonstrated near-term earnings strength and favorable cash flow metrics against the headwinds presented by the hedge position and valuation versus peers.
Investors and market participants will be watching execution on the 2026 development plan, capital deployment timing, and how realized prices versus hedge levels affect free cash flow through the year.