Utility Tuesday: Natural Gas Rewrites the AI Power Map at Oil Multiples

This Week's Setup

Fear & Greed at 44 lands in neutral territory, but the energy patch is pricing in a world where natural gas overtakes oil by 2030 and data center demand rewrites the infrastructure map. The S&P 500 CAPE at 38.9 tells you the broad market is expensive; energy multiples at 9–13× earnings and EV/EBITDA below 7× look like deep value or structural decline, depending on whether you believe the AI power thesis.

EQT just beat on strong gas demand from data centers and LNG, EOG trades at 13.8× with a 15% ROIC, and Valero hit a new 52-week high while analysts cut price targets. Insiders are selling at EOG and Chevron, buying at EQT and Baker Hughes.

Quick Scan

The 8 Names

1. EQT Corporation (EQT)

EV/EBITDA: 5.73 | Interest coverage: 7.79× | 52w drawdown: -26.9%

EQT trades at 9.5× earnings and 5.7× EV/EBITDA after a 60% year-over-year revenue jump driven by natural gas demand from data centers and LNG export terminals. The 9.1% FCF yield at a 27% drawdown is the widest free cash flow spread in this screen; analysts see 40% upside to $70.04.

Insiders John McCartney and Daniel J. Rice IV filed Form 4 transactions on July 6, the same week EQT beat estimates and flagged strong gas demand from data centers. The setup here is a natural gas pure-play at oil multiples with structural demand growth from AI infrastructure.

Net debt at 0.74× EBITDA is manageable, but natural gas prices remain volatile and the stock has underperformed oil producers over the trailing year. If data center electricity demand stalls or LNG export growth slows, the thesis unravels.

2. EOG Resources, Inc. (EOG)

EV/EBITDA: 6.14 | Interest coverage: 28.07× | 52w drawdown: -7.7%

EOG delivers a 15.2% ROIC, 4.6% FCF yield, and 2.9% dividend yield at 13.8× earnings. The 63% gross margin and 28× interest coverage signal operational strength; revenue declined 3.4% year-over-year, but the company remains one of the most efficient oil producers in the U.S.

Insiders Michael P. Donaldson, Ann D. Janssen, and Ezra Y. Yacob all sold shares in early July, totaling 14,343 net shares sold over the past six months with zero buys. The stock is within 8% of its 52-week high; the risk-reward skews toward waiting for a wider entry.

Analysts see 14% upside to $160.25, but the stock has already recaptured most of its 2025 decline. If oil prices weaken or capital discipline cracks across the sector, the multiple compresses quickly.

3. ConocoPhillips (COP)

EV/EBITDA: 6.76 | Interest coverage: 11.26× | 52w drawdown: -16.8%

ConocoPhillips trades at 6.8× EV/EBITDA and 19.2× earnings with a 5.3% FCF yield, 3% dividend yield, and 13.5% ROIC. The 17% drawdown puts the stock in the strong entry zone; analysts see 26% upside to $142.77.

Insiders Andres Felipe Mejia Cardona, Silvina Vatnick, and Sylvia Escovar Gomez filed Form 4 transactions on June 22. Revenue grew 7.7% year-over-year, and the company maintains net debt at 0.73× EBITDA while covering interest 11× over.

BMO Capital cut the price target from $135 to $130 this week, and news flow highlights Iran closing the Strait of Hormuz again, which drives oil price volatility. The upside case depends on crude prices holding above $75; below that, the multiple contracts.

4. Valero Energy Corporation (VLO)

EV/EBITDA: 9.11 | Interest coverage: 6.40× | 52w drawdown: +11.9%

Valero sits 12% above its 52-week high at 21.6× earnings, and analysts now see 12% downside to $259.47 after Citigroup raised its price target to $302. Revenue declined 5.5% year-over-year, and the 4.4% gross margin signals the refining environment remains tight.

Insider Eric A. Fisher filed two Form 4 transactions on June 30 and June 18. The stock has rallied 12% since its 52-week low, but the refining crack spread is compressing and the market is pricing in peak margins.

The setup here is a momentum trade at a cyclical peak. If refining margins weaken or crude prices spike without corresponding product price strength, Valero reverses hard. The 1.6% dividend yield offers no cushion.

5. MPLX LP (MPLX)

EV/EBITDA: 13.45 | Interest coverage: 5.82× | 52w drawdown: -4.0%

MPLX yields 7.5% and trades at 12.5× earnings with a 7% FCF yield and 19.2% ROIC. The midstream model insulates the partnership from commodity price swings; revenue grew 5.2% year-over-year, and the gross margin sits at 43.6%.

Net debt at 4.1× EBITDA is the highest leverage ratio in this screen. Interest coverage at 5.8× is manageable but leaves less room for error than the other names. The stock is within 4% of its 52-week high; the entry point is narrow.

Analysts see 5% upside to $60.71, which barely covers transaction costs. The yield is the thesis; if distribution growth stalls or energy infrastructure spending slows, the unit price drifts sideways for years.