Expand Energy: 2Q26 Preview: Flexing Its Buyback Muscles Given Discounted Valuation Under Subdued Strip Pricing Environment

Research evidence excerpt

Expand Energy: 2Q26 Preview: Flexing Its Buyback Muscles Given Discounted Valuation Under Subdued Strip Pricing Environment

Arun Jayaram AC North America Equity Research

(1-212) 622-8541 09 July 2026 J P M O R G A N

arun.jayaram@jpmchase.com

• Marketing provides a path to margin uplift. On the 1Q print, EXE provided some

breadcrumbs on the path to the $0.20 per Mcf (~$500 MM annual) margin

improvement, outlining three buckets of opportunities: 1) facilitating and capturing

new demand, 2) reaching premium markets, and 3) monetizing volatility. Interim

CEO Wichterich cited that ~50% of the margin improvement would come from the

first bucket, with the remaining 50% split between buckets 2-3. EXE disclosed an

early win on facilitating and capturing new demand with the quarter by signing a 20-

year SPA with Delfin FLNG. The SPA is for ~1.15 MMTpa (~160 MMcf/d)

beginning in 2031, and EXE stated that the previously announced SPAs with Delfin

and Gunvor had been terminated, as the new SPA is larger and gives EXE more

flexibility to market the volumes. EXE also noted that it was negotiating with Delfin

to manage the supply of natural gas to the facility. We believe this is another step in

EXE creating a portfolio of marketing opportunities to gain more access to

premium/international markets.

• 2Q26 expectations. JPMe EPS/CFPS of $1.11/$4.70 vs. the STe of $1.13/$4.60.

Our EBITDAX estimate of $1,157 MM compares to the STe at $1,162 MM.

• 2Q26 production and capex. We are modeling natural gas production of 6,938

MMcf/d and total production of 7,479 MMcfe/d, which compares to the STe at

6,898 MMcf/d and 7,460 MMcfe/d. Our capex estimate of $830 MM compares to

the STe at $798 MM.

• 2Q26 pricing realizations. Our natural gas price realization of $2.42 per Mcf