SM Energy’s Merger and Production Growth Plans Might Change the Case for Investing in SM (SM)

• SM Energy presented at the Stephens Annual Investment Conference on November 20, 2025, with key executives outlining a plan to grow production by more than 20% for 2025, emphasizing integration in the Uinta Basin and ramping up non-operated Permian projects, while continuing toward a merger with Civitas Resources.
• The conference highlighted SM Energy’s ambition to leverage asset integration for volume growth, alongside an anticipated merger that could reshape its operational footprint and risk exposure.
• We’ll explore how SM Energy’s accelerated production growth outlook, highlighted at the conference, may influence the company’s investment case.

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SM Energy Investment Narrative Recap

To be a shareholder in SM Energy, you would need to believe in the company’s ability to execute on aggressive production growth plans and manage both operational integration in the Uinta Basin and execution risk around the pending Civitas Resources merger. This latest conference update does not appear to materially shift the short-term catalyst, the successful closing of the Civitas deal, nor does it significantly reduce the principal operational risk centered on Uinta Basin logistics and sustainability.

The recent announcement most relevant to this development is the reaffirmed borrowing base and credit agreement, maintaining liquidity and flexibility as SM Energy moves through increased capital spending and potential merger integration. This enhanced financial stability aligns with near-term catalysts but leaves unresolved questions about how well the company will convert growth into resilient margins if regional bottlenecks persist.

However, as SM Energy aims for higher output, investors should be attentive to the possibility that ongoing Uinta Basin logistical constraints could…

Read the full narrative on SM Energy (it’s free!)

SM Energy’s narrative projects $3.5 billion in revenue and $550.3 million in earnings by 2028. This requires a 5.7% annual revenue growth rate and a $262.4 million decrease in earnings from the current $812.7 million.

Uncover how SM Energy’s forecasts yield a $33.92 fair value, a 78% upside to its current price.

Exploring Other PerspectivesSM Community Fair Values as at Nov 2025

Four individual fair value estimates from the Simply Wall St Community range from US$33.92 to as high as US$315.24 per share. While growth optimism appears prevalent in forecasts, clear operational risks such as Uinta Basin marketing challenges remind you that opinions and outcomes can differ, explore a variety of perspectives before making any decision.

Explore 4 other fair value estimates on SM Energy – why the stock might be a potential multi-bagger!

Build Your Own SM Energy Narrative

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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.

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