QS Research · Michael Burry's Scion Capital analyst template · 2006
EOG RESOURCES INC (EOG)
As of 2026-11-11 · 12/15 boxes filled from SEC filings and market data
Report price $151.51 (close 2026-11-10)
Conclusion: PASS
Conviction medium · base case +5% · downside -40% · upside +14%
EOG is a high-quality operator with net debt of $2.17B, 22.7% ROIC and a 4.37% net buyback yield, but $151.51 is priced on TTM EBIT of $10.65B, not the $6.18B normalized operating income (20.8% cycle margin x $29.73B TTM revenue). The independent base anchor is $158.61 (+5%) at the 10.05x peer-median P/E, while normalized EV/EBITDA cases run from $92.6 (-39%) at 4.5x to $172.2 (+14%) at 8.2x; the base case does not clear the +30% long hurdle and the downside is far worse than -25%. The 2026-11-05 Q3 beat, 8% dividend raise and $1B buyback are the dated catalysts that could rerate the stock, but Q3 included $242M of asset-disposition gains and $105M of derivative gains, and the 2026-11-06 commodity-timing sell call plus a crowded short at 6.5 days to cover explain the debate rather than a durable mispricing. This is a pass: a good asset at a price that already assumes above-cycle oil and gas realizations.
Key numbers
- Share price: $151.51
- Market cap: $78.56B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $29.73B
- EV / EBITDA (TTM): 5.2x
- P/E (TTM): 9.6x
- Price / book: 2.37x
- Earnings-quality flags (TTM): none flagged
- Revenue growth (latest fiscal year): -4.5%
- ROIC (TTM): 22.7%
- WACC: 5.5%
- Economic profit spread: +17.3 pts
The 15 boxes
- ✓ 1. Long-form business notes
EOG is a pure-play crude oil, NGL and natural gas explorer-producer: at December 31, 2025 it reported 5,514 MMBoe of net proved reserves, 99% in the United States and 1% in Trinidad, and it produced 449.8 MMBoe in FY2025. Since the oldest report on file here (FY2020: 3,220 MMBoe reserves, $11.03B revenue, -$544.0M operating income) the reserve base rose to 5,514 MMBoe, revenue to $22.63B in FY2025 ($29.73B TTM to September 30, 2026) and operating income to $6.38B ($10.65B TTM), while diluted shares fell from 579.00M to 546.00M and 526.00M on the TTM basis. The international portfolio changed: China, Oman and Canada in FY2020 gave way to Bahrain and the United Arab Emirates alongside Trinidad. Earnings swing with commodity prices rather than with a fixed cost base: operating income went -$544.0M (FY2020) to $9.97B (FY2022) to $6.38B (FY2025).
- ✓ 2. Competitive advantage
The sources describe no durable competitive advantage: EOG sells commodity crude oil, NGLs and natural gas, and operating income ran from a $544.0M loss (FY2020) to $9.97B (FY2022) to $6.38B (FY2025), driven by prices rather than any protected margin. The 10-K itself says certain competitors have 'financial and other resources substantially greater than those EOG possesses' and that EOG may be at a competitive disadvantage in bidding for drilling rights, services and personnel. The only internal cost lever named is drilling/completions efficiency work (downhole motors, extended laterals, self-sourced sand), which the same filing says may not be sufficient to offset inflation. Scale shows up in cash generation and buybacks, not in pricing power.
- ✓ 3. 10-Q takeaways
Q3 2026 sales rose 46% to $8,549 million as realized crude, NGL and gas prices and volumes increased, while operating expenses rose to $4,963 million and total per-Boe cost was $20.80 versus $20.86. Nine-month 2026 operating cash flow was $11,448 million, cash was $5.7 billion at September 30, 2026, and the 10-Q carries a $6.3-$6.7 billion 2026 capex plan plus 5%/14% production growth outlook. Q3 2026 included $242 million of asset-disposition gains and $105 million of derivative mark-to-market gains, which should be kept apart from operating earnings; the computed risk-factor diff shows four new or rewritten paragraphs including operating-efficiency/inflation risk.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
Sign in with a QuantSignals Premium or Gold plan to read every box: each point linked to the SEC filing it came from, the bull and bear case, and the comparables. QS Research powers the signals behind FST, our autonomous trading agent.