EOG Resources, Inc. (EOG) Resources Hit by Downgrade, Eyes Utica Upside

Core Viewpoint - EOG Resources, Inc. has been downgraded from Overweight to Sector Weight by KeyBanc analyst Tim Rezvan due to concerns over declining well productivity in its core Texas operations, particularly in the Eagle Ford and Delaware Basin regions [1][3]. Group 1: Analyst Downgrade and Concerns - KeyBanc's downgrade reflects worries about deteriorating productivity trends in EOG's primary production areas, which are critical to the company's performance [1]. - The analyst noted that initial production rates from new extra-large laterals can vary in their first year, leading to a more cautious outlook on EOG compared to previous expectations [2]. - Despite the downgrade, KeyBanc maintains a price target of $138 for EOG shares, indicating a belief in the stock's potential despite current challenges [2]. Group 2: Asset Performance and Market Outlook - KeyBanc remains optimistic about EOG's oily Utica asset, although there are concerns regarding productivity changes in legacy assets located in Texas [3]. - The analyst has adopted a more selective view of the energy sector as it approaches 2026, citing concerns over low oil prices and increased volatility in natural gas markets [3]. - EOG Resources operates as an independent oil and gas company, focusing on exploration, development, production, and marketing of crude oil, natural gas, and natural gas liquids, primarily in major US shale basins [4].