Mizuho downgrades EQT to Neutral on net asset value dilution

Mizuho downgraded EQT Corporation (EQT) to Neutral from Buy with a price target of $39, down from $46. The analyst updated the company’s model to reflect the company’s year-end 2023 reserves, 2024 guidance and the proposed merger with Equitrans Midstream (ETRN). The firm cites EQT’s near-term leverage overhang, net asset value dilution and a premium pro forma valuation for the downgrade. Mizuho sees the Equitrans merger lowering the company’s net asset value by 13% to $39 per share given higher leverage and equity value dilution.