Core Viewpoint - Goldman Sachs is optimistic about the energy sector, highlighting ten top stocks that offer dividends and significant growth potential, as energy stocks have outperformed the S&P 500 in 2026 due to favorable market conditions [1]. Energy Sector Performance - Energy stocks have surged in 2026, with the XLE index up 23% compared to the S&P 500's 1% increase, driven by high oil prices around $70 per barrel, recovering demand from Asia, and geopolitical tensions [1]. - Goldman Sachs anticipates continued strong performance in the energy sector, with an average total return of approximately 19% for their top picks [1]. Key Stock Recommendations - **Cheniere Energy (LNG)**: Leading U.S. LNG exporter with a 0.94% dividend, positioned for growth in domestic and international markets. Goldman Sachs targets a price of $275, indicating a 25% potential gain [1]. - **EQT Corp (EQT)**: One of the largest U.S. natural gas producers with a 1.14% dividend, focused on low-cost production in the Appalachian Basin. Goldman Sachs sets a price target of $66, suggesting a 16% upside [2]. - **Golar LNG (GLNG)**: Newly added to the Conviction List, offering a 2.26% dividend. Goldman Sachs has a target price of $56, representing a 27% potential gain [2]. - **Viper Energy (VNOM)**: Focused on mineral and royalty interests in the Permian Basin, with a 5.39% dividend yield. Goldman Sachs targets a price of $54, indicating a 23% upside [2]. - **Vistra Corp (VST)**: An integrated electricity and power generation company with a 0.56% dividend, expected to support data centers and cloud computing. Goldman Sachs sets a price target of $205, representing a 28% potential gain [2].

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **Energy sector**, highlighting a significant repricing of energy equities in 2026, with the XLE index up **23%** compared to the S&P 500's **1%** increase. This strength is attributed to positive GDP revisions, a tech rotation, and favorable oil momentum amid geopolitical uncertainties and smaller-than-expected surpluses [1][2]. Core Investment Ideas - The report identifies **10 stocks** with attractive total return potential, averaging **19%** total return, based on a mid-cycle view of **$70** Brent and **$3.75** Henry Hub prices [1][5]. Key Stocks and Their Investment Thesis 1. **HF Sinclair Corporation (DINO)** - Current Price: **$58.76**, Price Target: **$64** (9% upside) - Expected total return of **12%** with a **3%** dividend yield. - Strong balance sheet, non-refining earnings contributions, and exposure to a tighter West Coast market are key drivers [6]. 2. **ConocoPhillips (COP)** - Current Price: **$111.21**, Price Target: **$120** (8% upside) - Expected total return of **11%** with a **3%** dividend yield. - Major growth projects and cost reductions expected to generate **$7 billion** in incremental free cash flow by 2029 at **$70/b** WTI [7][9]. 3. **EQT Corporation (EQT)** - Current Price: **$56.93**, Price Target: **$66** (16% upside) - Expected total return of **17%** with a **1%** dividend yield. - Strong inventory position in the low-cost Appalachian Basin and improved cost structure post-acquisition are highlighted [10]. 4. **Viper Energy, Inc. (VNOM)** - Current Price: **$43.85**, Price Target: **$54** (23% upside) - Expected total return of **29%** with a **5%** dividend yield. - No-capex business model and commitment to return **75%** of cash available for distribution to shareholders are key factors [11]. 5. **Diamondback Energy, Inc. (FANG)** - Current Price: **$169.01**, Price Target: **$187** (11% upside) - Expected total return of **13%** with a **2%** dividend yield. - Strong operational execution and commitment to return capital to shareholders are emphasized [13]. 6. **Kinder Morgan, Inc. (KMI)** - Current Price: **$31.45**, Price Target: **$32** (2% upside) - Expected total return of **6%** with a **4%** dividend yield. - Significant natural gas-focused backlog and recent earnings beat are noted [14]. 7. **Cheniere Energy, Inc. (LNG)** - Current Price: **$219.41**, Price Target: **$275** (25% upside) - Expected total return of **26%** with a **1%** dividend yield. - Highly contracted asset footprint provides insulation from commodity price downside [15]. 8. **Golar LNG Limited (GLNG)** - Current Price: **$44.20**, Price Target: **$56** (27% upside) - Expected total return of **29%** with a **2%** dividend yield. - Shift towards floating liquefaction business and potential for significant EBITDA growth are highlighted [18]. 9. **Halliburton Company (HAL)** - Current Price: **$35.03**, Price Target: **$40** (14% upside) - Expected total return of **16%** with a **2%** dividend yield. - Strong performance in international markets and potential for margin expansion are noted [19]. 10. **Vistra Corp. (VST)** - Current Price: **$160.15**, Price Target: **$205** (28% upside) - Expected total return of **29%** with a **1%** dividend yield. - Upside potential from contracting remaining nuclear generation and favorable valuation metrics are discussed [21]. Additional Insights - The report emphasizes the importance of monitoring macroeconomic factors, commodity prices, and operational execution as key risks for the companies mentioned [26][27][29][30][31][34]. - The overall sentiment in the energy sector remains constructive, with expectations of continued strength in energy services and integrated oil stocks, despite some relative weakness in gas exploration and production [23]. This comprehensive overview captures the essential insights and investment opportunities within the energy sector as discussed in the conference call.

Core Viewpoint - EQT Corporation is recognized as one of the best oil and gas stocks to buy currently, despite recent price target reductions by analysts [1]. Group 1: Price Target Adjustments - Stephens reduced its price target for EQT from $69 to $68 while maintaining an Overweight rating [1]. - Scotiabank analyst Cameron Bean lowered the price target from $67 to $63, keeping a Sector Perform rating [3]. Group 2: Financial Priorities and Expectations - Reducing debt is EQT's top priority for free cash flow, with expectations to reach a net debt goal of $7.5 billion by early Q1 2026 [2]. - A positive update on the company's Deep Utica wells is anticipated, with a noted reduction in drilling costs by $2 million per well compared to the previous quarter [2]. Group 3: Market Outlook - Scotiabank's forecasts indicate ongoing supply deficits in the U.S. and Western Canada, suggesting potential increases in natural gas prices and related stocks over the next year [3]. Group 4: Company Overview - EQT Corporation is a vertically integrated natural gas company with operations focused in the Appalachian Basin [4].

Core Viewpoint - Diamond Hill Capital's "Large Cap Fund" investor letter for Q4 2025 highlights a cautious stance on AI-driven market enthusiasm while emphasizing the attractiveness of fundamentally stable, high-quality, cash-generative businesses [1]. Group 1: Market Overview - Equity markets showed upward momentum in Q4 2025, with the Russell 1000 Value Index increasing by 3.8% [1]. - The information technology sector rose by 11%, and communication services increased by 9%, primarily driven by optimism surrounding AI [1]. - The growth areas of the market contributed significantly to the Index's return in Q4 [1]. Group 2: Fund Performance - The Diamond Hill Large Cap Fund returned 1.41% in Q4 2025, underperforming compared to the Russell 1000 Value Index's 3.8% return [1]. Group 3: EQT Corporation Highlights - EQT Corporation (NYSE:EQT) was introduced as a new addition to the fund, recognized as a leading natural gas producer with a market capitalization of $34.168 billion [2]. - EQT's stock closed at $54.75 per share on February 2, 2026, with a 2.51% return over the past month and a 4.99% increase over the past twelve months [2]. - EQT is noted as the lowest-cost dry gas producer in Appalachia, benefiting from structural advantages such as scale and contiguous acreage [3]. Group 4: Hedge Fund Interest - EQT Corporation is not among the 30 most popular stocks among hedge funds, with 82 hedge fund portfolios holding EQT at the end of Q3 2025, down from 96 in the previous quarter [4]. - While EQT is acknowledged for its investment potential, the company is compared unfavorably to certain AI stocks that are perceived to offer greater upside potential and lower downside risk [4].

Core Viewpoint - EQT Corporation (NYSE:EQT) is identified as one of the most undervalued stocks, with significant projected gains from derivatives in the upcoming quarters [1]. Financial Projections - EQT Corporation anticipates gaining $114 million from derivatives for the fourth quarter of 2025, along with $35 million in net cash settlements from these derivatives [1]. - The company expects to receive $44 million in net cash settlements from its NYMEX natural gas hedge positions and $9 million from basis and liquids hedge positions in the same quarter [2]. - Premiums paid for settled derivatives in the fourth quarter of 2025 are projected to reach $45 million [2]. Analyst Ratings - Three analysts reaffirmed their ratings on EQT Corporation on January 26, with Piper Sandler maintaining a Hold rating and a $50 price target [3]. - Siebert Williams Shank & Co also kept a Hold rating, this time with a $62 price target [3]. - Morgan Stanley assigned a Buy rating with a $69 price target for the stock [3]. Company Overview - EQT Corporation is involved in the production, gathering, and transmission of natural gas, selling to marketers, utilities, and industrial customers primarily in the Appalachian Basin [4].

Core Viewpoint - EQT Corporation is a leading U.S. natural gas production company with a market cap of $34.9 billion, primarily operating in the Appalachian Basin, focusing on the Marcellus and Utica Shales [1] Performance Summary - EQT has underperformed the broader market over the past year, with stock prices increasing by 11.3% compared to the S&P 500 Index's 16.3% gains [2] - Over the past six months, EQT's stock surged 6.1%, while the S&P 500 Index rallied by 9.4% [2] - EQT also lagged behind the Energy Select Sector SPDR Fund's (XLE) gains of 12.6% over the past 52 weeks and 13.6% over the past six months [3] Recent Developments - On January 21, EQT shares rose more than 6% due to a rally in U.S. natural gas stocks, driven by a 24% surge in natural gas prices to a six-week high [4] - For FY2025, analysts expect EQT to deliver an adjusted EPS of $2.90, reflecting an 80.1% year-over-year increase [4] - EQT has a strong track record of earnings surprises, surpassing bottom-line estimates in each of the past four quarters [4] Analyst Ratings - Among 27 analysts covering EQT, the consensus rating is a "Strong Buy," consisting of 20 "Strong Buys," one "Moderate Buy," five "Holds," and one "Strong Sell" [5] - Stephens & Co. lowered its price target on EQT to $68 from $69 but maintained an "Overweight" rating [6] - The mean price target for EQT is $64.32, indicating a 14.2% upside potential, while the highest target of $76 represents a 34.9% premium to current price levels [6]

Investment Rating - The report does not explicitly state an investment rating for the industry Core Insights - The global natural gas industry has undergone a complete cycle from demand collapse and low prices to supply shocks and price surges, leading to a structural reshaping of global trade patterns [2][13] - By 2025, the global natural gas market is expected to be in a state of "tight balance" with demand growth slowing to 0.9% and supply remaining tight due to reliance on North American LNG projects [2][4] - The LNG market is entering a "super expansion cycle" from 2026 to 2030, with an expected cumulative addition of approximately 202 million tons of LNG capacity, primarily concentrated in North America and the Middle East [3][47] Summary by Sections 1. Review of 2020-2024: From Supply Shock to Structural Reshaping of Trade Patterns - The global natural gas industry experienced extreme price fluctuations, with TTF spot prices rising from an average of about 4-5 USD/MMBtu in 2020 to 80-90 USD/MMBtu in August 2022, before falling back to around 10 USD/MMBtu by 2025 [13] - The EU's LNG import share increased from 9% in 2021 to about 19% in 2023, while the US became the largest LNG exporter with 88.4 million tons in 2024 [22] 2. Current Situation in 2025: Tight Balance and Regional Demand Differentiation - The global natural gas market is characterized by a "tight balance" with demand growth slowing to approximately 0.9%, driven by high prices and macroeconomic uncertainties [2][4] - North American LNG supply is expected to increase significantly, with major contributions from projects like Plaquemines and Corpus Christi [32][35] 3. Outlook for 2026-2030: Supply Side - LNG "Super Expansion Cycle" - 2026 is projected to be a critical turning point for the global LNG "super expansion cycle," with an expected cumulative addition of about 202 million tons of LNG capacity, representing a 40% increase from 2025 [3][47] - The supply landscape is shifting from a "multi-polar" to a "US-Qatar dual-core" model, enhancing the pricing power of LNG in global markets [3][47] 4. Outlook for 2026-2030: Demand Side - Moderate Growth and Regional Differentiation - Global natural gas demand is expected to grow at a compound annual growth rate of approximately 1.56% from 2025 to 2030, with significant growth in the Asia-Pacific region, particularly driven by China [4][41] - European demand is anticipated to decline due to renewable energy substitution and decarbonization policies, while North American demand growth is projected to be below 1% [4][41] 5. US Gas Prices: Price Upcycle Driven by LNG Exports and Power Demand - The US natural gas market is transitioning from a tight balance to a shortage, with Henry Hub prices expected to rise significantly by 2027, supported by LNG exports and power demand from data centers [5][6] - The cost of new natural gas wells in the US is projected to stabilize between 3-3.5 USD/MMBtu, providing a long-term price floor for Henry Hub [5][6]

Core Insights - EQT Corporation is recognized as one of the most profitable stocks over the last 20 years [1] - Analysts have recently adjusted price targets for EQT, with Stephens lowering it to $68 and Scotiabank to $63, while maintaining positive ratings [2][3] Financial Performance - Stephens analyst Mike Scialla noted that EQT's Q4 cash flow per share and production estimates are 5% and 1% below consensus, respectively [2] - Scotiabank's projections indicate supply shortages in the U.S. and Western Canada, supporting predictions for higher natural gas prices [3] Company Overview - EQT Corporation is a leading U.S. energy company focused on the production, gathering, and transmission of natural gas, primarily in the Appalachian Basin [4]

Group 1 - EQT Corporation is considered one of the best inexpensive stocks to buy currently, with analysts from Scotiabank and Barclays adjusting their price targets to $63 and $64 respectively [1][2] - Scotiabank's revision of price targets for North American natural gas stocks is based on a bullish outlook, anticipating persistent supply deficits in the US and Western Canada, which is expected to drive commodity prices and energy equities higher [1][3] - Barclays maintains an Overweight rating for EQT while advising caution due to near-term commodity uncertainty, indicating a mixed sentiment in the market [2][3] Group 2 - EQT Corporation is involved in the production, gathering, and transmission of natural gas, selling to various customers in the Appalachian Basin [4]

Core Insights - U.S. natural gas futures have surged above $6 per million British thermal units (MMBtu) for the first time since 2022, driven by an Arctic blast that increased heating demand and constrained supply [1][4][6] - The price increase is expected to enhance profitability for exploration and production companies in the natural gas sector, benefiting diversified energy ETFs that hold these companies [2][6] Factors Behind the Price Surge - The surge in natural gas prices is attributed to intense weather-driven demand due to severe winter conditions, with nearly half of U.S. states declaring emergencies [4] - U.S. natural gas production fell by over 11 billion cubic feet per day due to operational disruptions caused by the storm, tightening supply further [5][6] - Despite robust gas storage levels prior to the storm, the immediate demand for heating created a short-term market squeeze [5] Impact on Companies - Major natural gas producers such as EQT Corporation, Expand Energy, and Coterra Energy are positioned to benefit from higher realized prices [6] - Larger diversified energy companies like ExxonMobil and Chevron, as well as LNG transporters like Kinder Morgan, are also expected to gain from the price rally [7] Advantages of Energy ETFs - Investing in energy ETFs mitigates risks associated with individual stocks, such as operational outages or regulatory hurdles, while providing diversified exposure across the sector [8][9] - Energy ETFs allow investors to capitalize on rising commodity prices and sector-wide profitability without relying on the performance of a single company [9][10] Recommended Energy ETFs - **State Street Energy Select Sector SPDR ETF (XLE)**: AUM of $31.16 billion, exposure to 22 companies, top holdings include ExxonMobil (24.14%) and Chevron (17.58%), up 10.7% over the past year [11][12] - **Vanguard Energy ETF (VDE)**: Net assets of $7 billion, exposure to 107 companies, top holdings include ExxonMobil (22.87%) and Chevron (15.02%), up 19.9% over the past year [13][14] - **Fidelity MSCI Energy Index ETF (FENY)**: Net assets of $1.28 billion, exposure to 101 companies, top holdings include ExxonMobil (22.98%) and Chevron (15.24%), up 10.6% over the past year [15] - **Global X U.S. Natural Gas ETF (LNGX)**: Net assets of $10.48 million, exposure to 34 companies, top holdings include Coterra Energy (8.21%) and Expand Energy (7.25%), up 10.8% over the past year [16][17]