Q2 results and guidance change put National Fuel Gas in focus

National Fuel Gas (NFG) is back on investors’ radar after reporting second quarter and six month earnings to March 31, 2026, alongside a cut to its full year production guidance.

The company reported second quarter sales of US$858.37 million, with net income of US$247.67 million and diluted earnings per share from continuing operations of US$2.59. For the first six months of the fiscal year, sales reached US$1,509.88 million and net income was US$429.31 million, with diluted earnings per share from continuing operations of US$4.58.

At the same time, National Fuel Gas lowered its 2026 production guidance to a range of 425 to 440 Bcf, down from the prior 440 to 455 Bcf range. This change may influence how you think about growth, capital allocation, and risk across its integrated upstream and midstream operations.

National Fuel Gas shares have retreated recently, with a 30 day share price return of down 14.42% and a year to date share price return of down 2.02%. At the same time, the 5 year total shareholder return sits at 80.84%, suggesting long term holders have still seen meaningful value creation.

If this earnings update has you thinking about where else to put fresh capital to work in energy infrastructure, it could be worth scanning 37 power grid technology and infrastructure stocks

With the stock down over the past month yet trading at a meaningful discount to the average analyst price target, you have to ask: is National Fuel Gas currently undervalued, or is the market already pricing in future growth?

Most Popular Narrative: 21.2% Undervalued

With National Fuel Gas last closing at $80.40 versus a narrative fair value of $102, the valuation story now centers on how much future earnings power is being priced in.

Expansion and modernization projects such as Shippingport Lateral and Tioga Pathway position the company to capitalize on regional population growth and rising industrial loads in the Northeast, enabling mid single digit annual rate base and production growth with improving capital efficiency, which should support higher future earnings and free cash flow.

Want to see what is baked into that higher fair value estimate? The narrative leans on compounding revenue growth, firmer margins and a richer future earnings multiple.

Result: Fair Value of $102 (UNDERVALUED)

However, this bullish narrative could be knocked off course if decarbonization policies accelerate in core states or if rising system modernization and environmental compliance costs limit free cash flow.

Another View on Value

While the fair value narrative points to an undervalued stock at $102, the SWS DCF model paints a sharper contrast, with an estimated future cash flow value of $38.51 versus the current $80.40 share price, which screens as expensive rather than cheap. Which story do you trust more: earnings power or cash flows?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out National Fuel Gas for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 44 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Conflicted by the mix of risks and rewards in this story? Take a close look at the numbers now and decide where you stand, starting with 5 key rewards and 1 important warning sign

Looking for more investment ideas?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.