Gulfport Energy Corporation’s (NYSE:GPOR) stock is climbing on Friday, up nearly 5%, as investors anticipate strong second-quarter earnings, driven by a strategic reevaluation of its capital spending plans.

The company is notably reallocating resources towards dry gas development in the latter half of the year, including adding a four-well dry gas Utica pad, while adjusting its wet gas Marcellus pad schedule.

This proactive approach and current capital efficiency trends could allow Gulfport to accelerate completions if natural gas market conditions remain favorable, potentially leading to low single-digit growth in 2026 and a departure from its current maintenance strategy.

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This pivot has been met with a positive outlook from JP Morgan. Zach Parham, an analyst at JP Morgan, reiterated the Overweight rating on Gulfport Energy, raising the price forecast from $208 to $236.

Parham anticipates a robust second quarter from Gulfport Energy, highlighting the company’s decision in the first quarter to reallocate some of its capital spending toward dry gas development in the latter half of the year. This includes adding a four-well dry gas Utica pad while postponing a four-well wet gas Marcellus pad.

Should the broader gas market remain favorable, Gulfport could accelerate some completions into the fourth quarter. Given current trends in capital efficiency, the company may be able to accommodate this additional activity without revising its existing capital expenditure guidance, as Parham writes.

With a growing emphasis on dry gas, there’s a chance Gulfport could transition to low single-digit growth in 2026, moving away from its current maintenance plan. Parham sees this as a positive development in light of a supportive 2026 outlook for natural gas.

After adjusting for market conditions in the second quarter, Parham estimates cash flow per share (CFPS) at $11.07, slightly ahead of the Street estimate of $10.77. EBITDA is forecasted at $208 million, modestly below the consensus of $223 million.

Estimated production of 1,037 MMcfe/d represents a 12% sequential increase and aligns with Street expectations, while oil output is pegged at 8.1 MBo/d, well ahead of the 7.0 MBo/d consensus.

Gulfport Energy’s second quarter natural gas realization is projected at $3.00 per Mcf before hedging, implying a $0.44 discount to NYMEX. Capital expenditures for the quarter are expected to land at $124 million, slightly exceeding consensus.

Parham forecasts $65 million in free cash flow, with $58 million allocated to share buybacks. This apart, the analyst anticipates an update on land acquisitions during the second-quarter earnings call, likely consistent with previous years’ spending of around $45 to $50 million.

Price Action: GPOR shares are trading higher by 4.52% to $183.89 at last check Friday.

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