Highlights

  • APA shows 60.50% one-year basic EPS growth, a P/E of 10.99 and PEG of -1.50.
  • APA repurchased 10.5 million shares at an average price of $42.78 in the third quarter.
  • Estimated third quarter average realized prices: US oil $87.50 per bbl, international oil $98.50.
  • Second quarter call: management raised 2026 Permian oil guidance to 123,000 barrels daily.

Growth, P/E and PEG sit side by side at APA (NASDAQ:APA), an undervalued growth stock: basic earnings per share grew 60.50% over one year, the trailing twelve-month P/E ratio is 10.99 and the PEG ratio, on an expected basis, is -1.50, with shares trading at USD 51.75 on October 28, 2026, up 1.89%. On the company's side, the oil and natural gas explorer and producer held its second quarter 2026 results call in August, where management raised full-year Permian oil production guidance, and on October 7 furnished supplemental third quarter 2026 information that included estimated realized prices and a share repurchase total.

Based in Houston, Texas, and incorporated in Delaware, APA Corporation owns consolidated subsidiaries that explore for and produce oil and natural gas in the United States, Egypt and the United Kingdom, and that explore for oil and natural gas offshore Suriname and elsewhere. Its common stock, $0.625 par value, is registered on the Nasdaq Global Select Market and Nasdaq Texas.

Growth: Third Quarter 2026 Supplemental Estimates

The October 7 release provided estimates that management believes will affect third quarter 2026 results. It estimated weighted-average basic common shares for the quarter at 348 million, the share count behind basic earnings per share. It estimated Egypt tax barrels at 36 MBoe/d and a net gain on oil and gas purchases and sales of $190 million before tax, which includes an $8 million realized gain from commodity derivatives.

Estimated average realized prices for the third quarter were $87.50 per barrel of oil, $26.00 per barrel of NGL and $1.45 per Mcf of natural gas in the United States. International estimates were $98.50 per barrel of oil, $155.00 per barrel of NGL, which the company said reflects low volumes and revenue recognition timing, and $5.00 per Mcf of natural gas.

Valuation: P/E of 10.99, PEG of -1.50 and Free Cash Flow Commentary

The P/E ratio of 10.99 is measured on trailing twelve-month earnings, and the PEG ratio of -1.50 on an expected basis.

On its second quarter call, management said it expects to generate approximately $950 million of pretax cash flow from its gas trading portfolio in 2026 and approximately $2.3 billion of free cash flow this year at current strip pricing. It said it has returned at least 60% of free cash flow to shareholders every year since introducing its capital allocation framework in late 2021, and expects to do so again in 2026.

Capital Returns, G&A and Balance Sheet Targets

APA repurchased 10.5 million shares at an average price of $42.78 per share during the third quarter. General and administrative expenses totaled approximately $115 million in the quarter, including $56 million of stock-based compensation, most of which the company said reflects mark-to-market effects of its share price during the quarter.

On the second quarter call, management said the company is progressing toward a net debt target of $3 billion and expects to reach it in 2027 at current strip pricing. It also said it expects $500 million of annualized run-rate cost savings by year-end, up from a $450 million target set in February.

Disclosed Risks and Outlook: Estimates, Egypt Gas and Timing

The company stated that its October 7 figures are estimates, are not a comprehensive presentation of factors affecting third quarter results, are subject to finalization of the financial reporting process, and may vary materially. It estimated dry hole costs of $25 million before tax for the quarter.

On the second quarter call, management said outperformance from recent rich gas discoveries led to the deferral of some lower-pressure gas volumes at Khafre in Egypt, which slightly reduces the near-term gas outlook, with higher associated liquids offsetting the impact. It now expects full-year gross Egypt production of approximately 118 thousand barrels of oil per day and 535 million cubic feet of gas per day. Management cited inflationary pressures, including global diesel costs, and said the next Block 58 exploration well is now expected in 2027.

Management also guided to a $1.3 billion U.S. capital budget and lease operating expense of $1.5 billion for 2026. It said first oil from the GranMorgu development in Suriname remains scheduled for mid-2028. APA will host its third quarter 2026 results call on November 5 at 10 a.m. Central time.