William Blair has maintained an Outperform rating on Northern Oil and Gas (NYSE: NOG), according to a research note released Monday. The research house expects the company’s fourth quarter 2025 results to look much like the prior quarter, with production and capital expenditures holding relatively steady.
Investors will have a near-term opportunity to confirm those expectations: Northern Oil and Gas is scheduled to report earnings on February 25, just 16 days away.
Looking beyond the immediate quarter, William Blair projects a different trajectory in 2026. The firm forecasts higher capital spending early in the year, which it says should translate into sizable production gains in the second half of 2026.
Those projections arrive against a backdrop of downward revisions from some market participants. InvestingPro data shows that eight analysts have recently lowered their earnings estimates for upcoming periods, signaling caution among parts of the sellside.
William Blair also weighed in on Northern Oil and Gas’s acquisition approach. The firm expects the company to continue pursuing a "ground-game" acquisition strategy, but it believes management will exercise discipline when evaluating deals. That caution is framed by peer leverage that William Blair characterizes as above average, and by Northern Oil and Gas’s own balance sheet metrics, including a debt-to-equity ratio of 1.05 and total debt of $2.35 billion.
InvestingPro’s Fair Value assessment indicates the stock is currently trading below intrinsic value, a view that supports the Outperform stance even as leverage and valuation dynamics constrain deal activity.
On the shareholder return front, William Blair does not anticipate any change to Northern Oil and Gas’s quarterly dividend. The company currently yields roughly 7%; InvestingPro pins the precise dividend yield at 7.02% and notes that the firm has increased its dividend for five consecutive years.
Corporate actions and hedging updates have been notable. Northern Oil and Gas announced a definitive agreement to acquire a 49% interest in Ohio Utica Shale assets for $588 million in cash, part of a larger $1.2 billion transaction. The assets include approximately 35,000 net acres and more than 100 gross identified undeveloped drilling locations.
Following that transaction, Northern Oil and Gas materially increased its natural gas hedging positions. The company’s hedge volumes for 2026 and 2027 now cover a substantial portion of its projected natural gas production, a move that affects near- and medium-term cash flow visibility.
Market analysts have adjusted their price targets and ratings in light of commodity pricing and differential shifts. Raymond James trimmed its price target for Northern Oil and Gas to $32.00 from $33.00 but maintained a Strong Buy rating, citing weaker commodity strip prices. Mizuho lowered its price target to $29.00 from $30.00 and kept a Neutral rating, pointing to wider natural gas differentials and forecasting some stabilization in company activity by 2026 after projects were deferred in 2025 amid lower oil prices.
Together, these analyst moves and the company’s recent transactions reflect a period of strategic recalibration for Northern Oil and Gas as it balances growth spending, deal discipline and shareholder returns amid market headwinds.
Key context and metrics
- Northern Oil and Gas has been profitable over the last twelve months with a price-to-earnings ratio of 14.06, per InvestingPro data.
- Analysts’ consensus recommendation sits at 2.18, which corresponds to a Buy rating on average across coverage.
- Company balance sheet: debt-to-equity ratio of 1.05 and total debt of $2.35 billion.
What to watch next
- Quarterly results due February 25 will provide confirmation of William Blair’s view that Q4 2025 will closely resemble the previous quarter.
- Execution on early-2026 capital spending and the timing of production increases in H2 2026 will be key to validating the firm’s longer-term forecast.
- Integration and performance of the Ohio Utica Shale assets, plus the impact of expanded gas hedges on realized prices and cash flow.