Raymond James said SM Energy has received a big boost from rising oil prices due to the Iran war, but the stock still has room to rise. The investment bank upgraded the energy name from underperform to outperform. He also has a $55 price target on the stock, implying a 60% upside from Tuesday’s closing price. “SM has been one of the biggest beneficiaries of the post-Iran war oil shift, and despite the steep decline in stock prices, our bullish oil outlook still has good upside potential relative to current oil prices,” analyst John Freeman said in a note to clients. Oil and gas inventories have risen 84% this year as oil prices rose as the war between the U.S. and Iran heightened concerns about crude oil supplies. West Texas Intermediate futures are up 76% in 2026. After starting the year at around $57 per barrel, it was most recently trading around $100 per barrel. SM YTD Mountain stock is up 84% year-to-date. Raymond James said the recent “oil cash flow windfall” already provides SM Energy with further upside potential, regardless of whether or not the Middle East wars end soon. Referring to SM Energy’s January merger with exploration and production company Civitas Resources, Freeman wrote, “The oil cash flow windfall allowed the company to clean up its balance sheet post-merger completion (which was even more negative than its peers before recent debt reductions).” He noted that the company has reduced its absolute debt by approximately $700 million. “As a result, we expect leverage to fall below 1x by the fourth quarter (and even earlier in our oil outlook),” Freeman added. Raymond James’ call goes against Wall Street consensus. Of the 14 analysts covering SM Energy, six have a buy or strong buy rating on the stock, and seven have a hold rating, according to LSEG data.
