Coterra Energy (CTRA) Increases Yet Falls Behind Market: What Investors Need to Know

NEW YORK – Coterra Energy (CTRA) shares closed higher in the latest trading session, but a closer look at the numbers reveals a complex and contradictory picture for investors. While the stock's daily gain was a positive sign, it failed to keep pace with the broader market's rally, and a collection of underlying metrics—from analyst ratings to valuation—presents a puzzle that demands careful consideration ahead of the company's next earnings report.

The independent oil and gas producer finished the day at $30.66, a modest increase of 1.15%. This gain, however, was overshadowed by a more exuberant market, with the S&P 500 climbing 1.97%, the Dow Jones Industrial Average surging 2.47%, and the tech-heavy Nasdaq Composite adding 2.18%. This single-day underperformance belies a period of powerful momentum for the company, creating a critical divergence for investors to analyze.

A Tale of Two Timelines: Daily Lag vs. Monthly Surge

While Coterra lagged the major indices in the last session, its performance over a wider timeframe tells a story of significant strength. The stock has been a standout performer within its sector, rewarding shareholders who have held on through recent market volatility.

• One-Month Performance: Coterra's shares have rocketed up by 19.28% over the past month.
• Sector Comparison: This gain dramatically outpaces the broader Oils-Energy sector, which saw a more moderate increase of 9.19% during the same period.
• Market Comparison: The stock's performance is even more striking when set against the S&P 500, which posted a loss of 1.49% over the last month.

This powerful run-up indicates strong investor confidence in Coterra's near-term prospects, likely driven by favorable commodity prices and operational execution. However, upcoming financial disclosures will test whether this optimism is fully warranted.

Spotlight on Upcoming Earnings

The investment community's attention is now firmly fixed on Coterra's forthcoming quarterly earnings release, scheduled for February 26, 2026. The report is expected to deliver a mixed message, with projections showing a significant disconnect between top-line growth and bottom-line profitability.

• Earnings Per Share (EPS): The consensus estimate anticipates an EPS of $0.46. This would mark a 6.12% decline compared to the same quarter in the previous year, suggesting potential pressure on margins or rising operational costs.
• Revenue: In stark contrast, revenue is projected to be $1.88 billion. This represents a massive 34.76% escalation from the year-ago quarter, signaling robust production levels or higher realized prices for its oil and gas output.

This divergence between surging revenue and falling earnings will be a central focus for analysts. Management's commentary on production costs, hedging effectiveness, and capital expenditures will be crucial in explaining this trend.

The Broader Fiscal Picture

Looking beyond a single quarter, full-year projections paint a more uniformly positive picture for Coterra's financial health. The Zacks Consensus Estimates for the entire fiscal year point to substantial growth on both the top and bottom lines, reinforcing the bull case for the stock.

• Full-Year EPS: Projections call for earnings of $2.14 per share, which would represent a 27.38% increase from the prior year.
• Full-Year Revenue: The consensus estimate is for revenue to reach $7.52 billion, a remarkable 37.81% jump compared to the previous year.

This robust full-year outlook suggests that the anticipated dip in quarterly EPS may be a temporary anomaly rather than the start of a negative trend.

A Warning Sign from Analysts

Despite the stock's recent price appreciation and strong full-year forecasts, a significant red flag has emerged from analyst estimate revisions. These modifications, which reflect evolving perceptions of a company's business trends and profitability, have turned decidedly negative for Coterra.

Our research, based on the proprietary Zacks Rank model, shows that changes in earnings estimates are directly correlated with near-term stock price movements. The system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an externally audited track record of outperformance, with #1 stocks averaging a +25% annual return since 1988.

• Zacks Rank: Coterra Energy currently holds a Zacks Rank of #5 (Strong Sell). This is the lowest possible rating and indicates a strong expectation of underperformance in the near term.
• Consensus Estimate Change: The bearish rating is underpinned by a significant downward revision in earnings expectations. The Zacks Consensus EPS estimate has plummeted by 25.6% over the past month.

This sharp drop in analyst sentiment stands in direct opposition to the stock's 19% price gain over the same period, creating a classic bull-bear standoff that the upcoming earnings report will help resolve.

Decoding the Valuation Puzzle

Valuation metrics add another layer of complexity to the Coterra story, presenting investors with conflicting signals about whether the stock is overvalued or a bargain.

• Forward P/E Ratio: Coterra is currently trading at a Forward Price-to-Earnings (P/E) ratio of 15.53. This represents a premium compared to its industry's average of 12.89, suggesting that investors are paying more for each dollar of Coterra's expected earnings than for its peers.
• PEG Ratio: Conversely, the stock's PEG ratio is 0.66. The PEG ratio adjusts the P/E for future earnings growth, and a ratio below 1.0 is often considered attractive. Coterra's figure is substantially lower than the industry average of 2.43, indicating that its stock price may be undervalued relative to its high growth expectations.

The Bottom Line for Investors

Coterra Energy presents a study in contrasts. The stock boasts impressive monthly momentum and a strong full-year growth outlook. Yet, it is saddled with a "Strong Sell" rating from Zacks, driven by sharply declining analyst estimates and a forecast for a year-over-year drop in quarterly profits. Its valuation is simultaneously at a premium by one measure (P/E) and a potential bargain by another (PEG).

For investors, the path forward requires careful navigation. The upcoming earnings report on February 26, 2026, is a pivotal event. Key items to watch will be management’s explanation for the divergence between revenue and EPS, detailed guidance on future production and costs, and any commentary that addresses the recent slide in analyst consensus. The resolution of these conflicting signals will likely determine the stock's next major move.