EOG
EOG
Accumulate 2026-04-22
Model
DCF
Price at Report
$132.43
Base IV
$143.80
Bear IV
$99.78
Bull IV
$178.55
Entry Zone: 108-125 · Sell Above: 170
Bore Family Office
Valuation Report — EOG Resources, Inc. (EOG) • April 22, 2026
Unlevered DCF (FCFF @ WACC) • Discount Rate: 8.50% • Current Price: $132.43
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
EOG Resources is one of the largest independent oil & gas exploration and production companies in the US, focused almost entirely on premium crude oil from the Permian Basin, Eagle Ford, and Bakken shales. EOG differentiates itself through a premium drilling strategy — targeting only the best rock, which delivers higher returns per well than peers.
FY2025 was a cyclical trough year: revenue fell 4.5% to $22.6B, EPS dropped 19% to $9.12, and FCF fell 40% to $3.45B as WTI crude averaged ~$65/bbl. Despite this, EOG maintained its dividend growth streak (7.7% increase to $3.99/share) and continued aggressive share buybacks (4% share reduction in 2025). The balance sheet is fortress-grade: only $7.9B in LT debt (D/E ratio of 0.16) against $7B+ in annual EBITDA.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Crude Oil & NGL | $18,200M | 80% | -5.0% | 30.0% | Premium shale oil — core value driver |
| Natural Gas | $4,400M | 20% | +8.0% | 22.0% | Growing with gas price recovery |
| Blended Growth Rate | — | 100% | -2.4% | — | Weighted avg across segments |
📊 Business Lifecycle Stage
Stage 1
Startup
Startup
Stage 2
Hyper Growth
Hyper Growth
Stage 3
Self Funding
Self Funding
Stage 4
Operating Leverage
Operating Leverage
Stage 5
Capital Return
Capital Return
Stage 6
Decline
Decline
Stage 4 — Operating Leverage: Revenue growing modestly with profits inflecting rapidly. The classic DCF sweet spot — FCF is reliable, growing, and well-anchored to analyst estimates.
Why this drives model selection: Classic DCF sweet spot — FCF inflecting and growing rapidly.
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 9.1% | 8–12% adequate |
| FCF Margin | 15.2% | ≥10% strong |
| Debt / EBITDA | 0.7x | ≤2x conservative |
| Revenue Trend | Mixed | 3-year directional trend |
| FCF Margin Trend | Contracting | Directional margin trajectory |
| Analyst Revisions | Neutral | Last 90 days consensus direction |
✅ Quality profile supports the valuation
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $18,642 | $25,702 | $24,186 | $23,698 | $22,632 |
| Rev YoY Growth | — | +37.9% | -5.9% | -2.0% | -4.5% |
| Gross Margin | 86.3% | 88.6% | 87.3% | 86.1% | 83.2% |
| EBITDA ($M) | $9,753 | $13,508 | $13,095 | $12,190 | $10,846 |
| EBITDA Margin | 52.3% | 52.6% | 54.1% | 51.4% | 47.9% |
| Operating Income ($M) | $6,102 | $9,966 | $9,603 | $8,082 | $6,385 |
| Operating Margin | 32.7% | 38.8% | 39.7% | 34.1% | 28.2% |
| Net Income ($M) | $4,664 | $7,759 | $7,594 | $6,403 | $4,980 |
| Net Margin | 25.0% | 30.2% | 31.4% | 27.0% | 22.0% |
| EPS (diluted) | $7.99 | $13.22 | $13.00 | $11.25 | $9.12 |
| Free Cash Flow ($M) | $4,941 | $6,093 | $5,155 | $5,771 | $3,450 |
| Annual DPS | $1.988 | $3.075 | $3.385 | $3.705 | $3.990 |
| Total Debt ($M) | $5,853 | $5,750 | $5,700 | $6,800 | $7,909 |
💹 Capital Return & Share Count Analysis
Net Share Change
-8.0% (2021→2025)
📉 Net reduction — buybacks exceed issuances
EPS Amplification
EPS grew +14.1% vs net income +6.8% over the period — +7.4pp of EPS growth amplified by share reduction.
| Year | Diluted Shares (M) | YoY Change | Buyback Spend ($M) | Buyback Yield |
|---|---|---|---|---|
| 2021 | 585.0M | — | $1,500 | 1.9% |
| 2022 | 588.0M | +0.5% | $2,200 | 2.8% |
| 2023 | 581.0M | -1.2% | $2,400 | 3.1% |
| 2024 | 557.0M | -4.1% | $2,600 | 3.5% |
| 2025 | 538.0M | -3.4% | $2,800 | 3.9% |
EOG is one of the most aggressive buyback programs in E&P — shares reduced from 585M to 538M over 5 years (8% reduction). Buyback yield is ~5% at current prices. Combined with the 3% dividend, total shareholder return exceeds 8%/yr from capital return alone.
⚙️ WACC Build (DCF)
| Input | Value | Notes |
|---|---|---|
| Risk-Free Rate (Rf) | 4.25% | 10-yr US Treasury yield |
| Beta (β) | 0.270 | Market beta (Finnhub) |
| Equity Risk Premium (ERP) | 5.5% | Damodaran US ERP |
| Cost of Equity (Ke) | 5.74% | Ke = Rf + β × ERP |
| Pre-Tax Cost of Debt | 4.00% | Interest exp / gross debt |
| After-Tax Cost of Debt (Kd) | 3.16% | × (1 − 21%) |
| Weight Equity (We) | 90.0% | Mkt cap $0.0B |
| Weight Debt (Wd) | 10.0% | Gross debt $0.0B |
| WACC | 8.50% | DCF discount rate |
📈 DCF Scenarios
$100
🔴 Bear
$144
📊 Base
$179
🚀 Bull
$132.43
Current Price
$147
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | WACC | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | -3.0% | 0.0% | 2.0% | 10.00% | $100 | ▼24.7% |
| 📊 Base | 5.0% | 2.5% | 2.5% | 8.50% | $144 | ▲8.6% |
| 🚀 Bull | 10.0% | 4.0% | 3.0% | 8.00% | $179 | ▲34.8% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: -3.0% | Stage 2: 0.0% | Terminal: 2.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $4.20B | $3.82B | $3.82B |
| Year 2 ✦ | Stage 1 | $4.60B | $3.80B | $7.62B |
| Year 3 ✦ | Stage 1 | $5.00B | $3.76B | $11.38B |
| Year 4 ✦ | Stage 1 | $5.30B | $3.62B | $15.00B |
| Year 5 ✦ | Stage 1 | $5.60B | $3.48B | $18.47B |
| Year 6 | Stage 2 | $5.60B | $3.16B | $21.63B |
| Year 7 | Stage 2 | $5.60B | $2.87B | $24.51B |
| Year 8 | Stage 2 | $5.60B | $2.61B | $27.12B |
| Year 9 | Stage 2 | $5.60B | $2.37B | $29.50B |
| Year 10 | Stage 2 | $5.60B | $2.16B | $31.65B |
| Terminal | — | TV=$71.4B | PV(TV)=$27.5B (47% of EV) | EV=$59.2B |
| Intrinsic Value | — | — | EV $59.2B − Net Debt → Equity / Shares | $100 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.00%) to get its present value. After Year 10, FCF grows at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $71.4B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $27.5B). Enterprise Value = PV of FCFs ($31.7B) + PV of TV ($27.5B) = $59.2B. Subtracting net debt gives equity value of $53.7B, divided by shares outstanding = $100 per share.
Base Scenario
Stage 1: 5.0% | Stage 2: 2.5% | Terminal: 2.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $4.20B | $3.87B | $3.87B |
| Year 2 ✦ | Stage 1 | $4.60B | $3.91B | $7.78B |
| Year 3 ✦ | Stage 1 | $5.00B | $3.91B | $11.69B |
| Year 4 ✦ | Stage 1 | $5.30B | $3.82B | $15.52B |
| Year 5 ✦ | Stage 1 | $5.60B | $3.72B | $19.24B |
| Year 6 | Stage 2 | $5.74B | $3.52B | $22.76B |
| Year 7 | Stage 2 | $5.88B | $3.32B | $26.08B |
| Year 8 | Stage 2 | $6.03B | $3.14B | $29.22B |
| Year 9 | Stage 2 | $6.18B | $2.97B | $32.19B |
| Year 10 | Stage 2 | $6.34B | $2.80B | $34.99B |
| Terminal | — | TV=$108.2B | PV(TV)=$47.9B (58% of EV) | EV=$82.9B |
| Intrinsic Value | — | — | EV $82.9B − Net Debt → Equity / Shares | $144 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (8.50%) to get its present value. After Year 10, FCF grows at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $108.2B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $47.9B). Enterprise Value = PV of FCFs ($35.0B) + PV of TV ($47.9B) = $82.9B. Subtracting net debt gives equity value of $77.4B, divided by shares outstanding = $144 per share.
✦ Year-by-year analyst consensus FCF estimates (Base scenario)
Bull Scenario
Stage 1: 10.0% | Stage 2: 4.0% | Terminal: 3.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $4.20B | $3.89B | $3.89B |
| Year 2 ✦ | Stage 1 | $4.60B | $3.94B | $7.83B |
| Year 3 ✦ | Stage 1 | $5.00B | $3.97B | $11.80B |
| Year 4 ✦ | Stage 1 | $5.30B | $3.90B | $15.70B |
| Year 5 ✦ | Stage 1 | $5.60B | $3.81B | $19.51B |
| Year 6 | Stage 2 | $5.82B | $3.67B | $23.18B |
| Year 7 | Stage 2 | $6.06B | $3.53B | $26.71B |
| Year 8 | Stage 2 | $6.30B | $3.40B | $30.12B |
| Year 9 | Stage 2 | $6.55B | $3.28B | $33.39B |
| Year 10 | Stage 2 | $6.81B | $3.16B | $36.55B |
| Terminal | — | TV=$140.4B | PV(TV)=$65.0B (64% of EV) | EV=$101.6B |
| Intrinsic Value | — | — | EV $101.6B − Net Debt → Equity / Shares | $179 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (8.00%) to get its present value. After Year 10, FCF grows at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $140.4B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $65.0B). Enterprise Value = PV of FCFs ($36.5B) + PV of TV ($65.0B) = $101.6B. Subtracting net debt gives equity value of $96.1B, divided by shares outstanding = $179 per share.
🔲 Sensitivity Table
| WACC \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 6.5% | $172 | $186 | $203 | $225 | $254 |
| 7.0% | $155 | $166 | $179 | $195 | $216 |
| 7.5% | $141 | $150 | $160 | $172 | $188 |
| 8.0% | $129 | $136 | $144 | $154 | $166 |
| 8.5% | $119 | $125 | $131 | $139 | $148 |
| 9.0% | $110 | $115 | $120 | $127 | $134 |
| 9.5% | $102 | $106 | $111 | $116 | $122 |
| 10.0% | $96 | $99 | $103 | $107 | $112 |
| 10.5% | $89 | $92 | $96 | $99 | $103 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Metric | EOG | CXO | FANG | PXD | 5yr Avg (EOG) |
|---|---|---|---|---|---|
| P/E (NTM) | 10.2x | 9.8x | 8.5x | 10.0x | 12.5x |
| EV/EBITDA | 6.5x | 6.0x | 5.5x | 5.8x | 7.0x |
| P/FCF | 22.1x | 12.0x | 10.5x | 11.2x | 9.5x |
| Div Yield | 3.0% | 2.5% | 3.2% | 2.8% | 2.0% |
| PEG | 0.2x | 0.5x | 0.3x | 0.4x | 0.5x |
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $3.990 |
| Current Yield | 3.01% |
| Consecutive Growth Years | 10 |
| 1-yr DPS CAGR | +7.7% |
| 3-yr DPS CAGR | +5.6% |
| 5-yr DPS CAGR | +5.0% |
| 10-yr DPS CAGR | +20.0% |
| Payout Ratio (DPS/EPS) | 43.7% |
| FCF Payout Ratio | 62.3% |
| Sustainability Verdict | Safe |
EOG's dividend has grown for 10 consecutive years (including through the 2020 COVID crash) at a 20% CAGR over 10 years. The 43.7% payout ratio on EPS and 62% FCF payout are both healthy. EOG's premium drilling strategy and fortress balance sheet ensure the dividend is well-covered even in a downturn.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $7.99 | — | — | — | Actual |
| 2022 | $13.22 | — | — | — | Actual |
| 2023 | $13.00 | — | — | — | Actual |
| 2024 | $11.25 | — | — | — | Actual |
| 2025 | $9.12 | — | — | — | Actual |
| 2026 | $7.99 | $13.01 | $19.14 | 35 | Estimate |
| 2027 | $9.21 | $12.93 | $17.33 | 33 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $18.6B | — | — | — | Actual |
| 2022 | $25.7B | — | — | — | Actual |
| 2023 | $24.2B | — | — | — | Actual |
| 2024 | $23.7B | — | — | — | Actual |
| 2025 | $22.6B | — | — | — | Actual |
| 2026 | $21.7B | $26.4B | $32.8B | 35 | Estimate |
| 2027 | $23.1B | $26.2B | $30.6B | 33 | Estimate |
(c) Individual Analyst Price Targets
Consensus: Avg $147.38 | Range $124–$199
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Alastair Syme | Citigroup | Strong Buy | $235 | +77.5% |
| Hanwen Chang | Wells Fargo | Buy | $199 | +50.3% |
| Mark Lear | Piper Sandler | Hold | $147 | +11.0% |
| Nitin Kumar | Mizuho | Hold | $147 | +11.0% |
| Scott Gruber | Citigroup | Hold | $142 | +7.2% |
(e) Confidence Band Commentary
Analyst consensus is a Buy with a PT of $147, but the EPS range is extremely wide ($8-$19 for FY2026), reflecting oil price uncertainty. EOG's premium drilling strategy and balance sheet quality earn it a slight premium to the E&P group. The stock trades at 10.2x forward EPS — cheap on an absolute basis but reflects the cyclical trough.
💡 Investment Thesis
- Bull case: Oil recovers to $75+ and EOG's premium drilling strategy generates outsized returns. The company is buying back 4-5% of shares annually while growing the dividend 7%+. FCF surges to $6-7B, and the P/E re-rates from 10x to 13-14x as investors recognize EOG as the best-in-class E&P. Price target: $165-180.
- Bear case: Oil stays below $65 for an extended period. EOG's FCF compresses toward $2-3B, and the buyback pace slows. The stock trades sideways at 10x depressed earnings. At worst, a move to $100-110 if WTI drops to $50.
- Key assumption: WTI crude averages $70-75/bbl in FY2026-2027. This supports $13+ EPS and $5-6B FCF, enabling continued buybacks and dividend growth.
- Catalyst: Q1 2026 production update (May) — if EOG maintains premium well economics and guides for production growth, expect upward revisions.
- Risk: EOG is a pure-play oil company — the thesis lives or dies with crude prices. Climate policy and ESG pressures are long-term headwinds but don't affect near-term cash flows.
👔 Management Quality & Culture
CEO: Not identified · Tenure: Since 2021 (~5 yrs)
Net Insider Buys (12m)
+95,964 shares
Incentive Alignment
⚠️ Moderate
Compensation: Equity-based compensation present
CEO Background & Track Record
EOG Resources - Wikipedia
In 1998, Mark G. Papa was named chairman and chief executive officer. In 1999, the company became independent from Enron and changed its name to EOG Resources, Inc.
In 1998, Mark G. Papa was named chairman and chief executive officer. In 1999, the company became independent from Enron and changed its name to EOG Resources, Inc.
Leadership – EOG Resources, Inc.
Chairman of the Board and Chief Executive Officer · EVP and Chief Operating Officer
Chairman of the Board and Chief Executive Officer · EVP and Chief Operating Officer
EOG Resources Announces Bill Thomas' Retirement and Ezra Yac
Bill Thomas has served as EOG's non-executive Chairman of the Board since October of last year. Following several technical and leadership roles in his more than 43-year career with EOG, Thomas served as Chairman of the Board and Chief
Bill Thomas has served as EOG's non-executive Chairman of the Board since October of last year. Following several technical and leadership roles in his more than 43-year career with EOG, Thomas served as Chairman of the Board and Chief
Capital Allocation & Strategy
EOG Resources Reports Fourth Quarter and Full-Year 2024 Resu
Since we initiated share repurchases in 2023, we have reduced our share count by approximately 5%. As we continue to optimize our capital structure, our strong cash flow generation and industry-leading balance sheet better
Since we initiated share repurchases in 2023, we have reduced our share count by approximately 5%. As we continue to optimize our capital structure, our strong cash flow generation and industry-leading balance sheet better
EOG Resources, Inc. (EOG) Stock Price, Market Cap, Segmented
In conclusion, EOG Resources presented a stable and strategically sound performance in Q1 2025, demonstrating its commitment to shareholder value through disciplined capital allocation and operational excellence.
In conclusion, EOG Resources presented a stable and strategically sound performance in Q1 2025, demonstrating its commitment to shareholder value through disciplined capital allocation and operational excellence.
Employee Ratings
Reviews
309
Culture Signal
Positive
✅ Strengths
- great culture
- good pay
- recommend
⚠️ Concerns
- fired
Employee Review Excerpts
EOG Reviews (309): Pros & Cons of Working At EOG | Glassdoor
Sep 6, 2025 · Data engineer · Current employee, more than 1 year · Houston, TX · Recommend · CEO approval · Business Outlook · Pros · Good place to work/Learning a lot · Cons · I don't see anything bad so far! Show mor
Sep 6, 2025 · Data engineer · Current employee, more than 1 year · Houston, TX · Recommend · CEO approval · Business Outlook · Pros · Good place to work/Learning a lot · Cons · I don't see anything bad so far! Show mor
Working at EOG Resources: 247 Reviews | Indeed.com
Great culture. Innovative technology. Good communication from top down and amongst different departments. If you get on with EOG, bring your A game; EOG is one of the best and they expect your best.
Great culture. Innovative technology. Good communication from top down and amongst different departments. If you get on with EOG, bring your A game; EOG is one of the best and they expect your best.
EOG "great company" Reviews | Glassdoor
What other Fortune 500 company do you get to present face-to-face with the CEO? ... The company is decentralized so changing job roles sometimes requires you to relocate and move divisions. In my experience this has resulted in excellent op
What other Fortune 500 company do you get to present face-to-face with the CEO? ... The company is decentralized so changing job roles sometimes requires you to relocate and move divisions. In my experience this has resulted in excellent op
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ DCF Verdict: Accumulate — EOG Resources, Inc. (EOG)
Current price: $132.43 | Analyst Avg PT: $147.38
$100
🔴 Bear
$144
📊 Base
$179
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$125 | Begin position |
| Tier 2 — Add | ≤$115 | Add on weakness |
| Tier 3 — Full | ≤$108 | Full allocation |
| Sell Alert | ≥$170 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Verdict: Accumulate. At $132.43, EOG trades near its base-case DCF value with a 3% dividend yield, 10.2x forward P/E, and 8% total shareholder return from buybacks + dividends. The cyclical trough is the time to buy E&P names — add on weakness below $125, with full position below $115.
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Normalized FCF | We use $4.0B as normalized mid-cycle FCF, not the FY2025 trough of $3.45B. This reflects oil prices recovering to $70+ and EOG maintaining production discipline. The 5-year average FCF is $5.3B — our base is conservative, reflecting continued commodity uncertainty. |
| WACC | 8.5% WACC is above the pure CAPM-implied 6.0% (due to ultra-low beta of 0.27). We add a 2.5% commodity risk premium — beta underestimates EOG's true volatility because oil prices drive earnings, not market correlation. |
| Net Debt | EOG carries only $7.9B in long-term debt (D/E = 0.16) — one of the strongest balance sheets in E&P. Net debt is ~$5.5B after $2.4B in cash. This fortress balance sheet is a key competitive advantage. |
| Sanity Check | Base IV of ~$144 is within 2% of analyst consensus PT of $147.38. The DCF validates that EOG is fairly valued at current levels, with upside if oil recovers and downside if the trough extends. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.