Freedom Upgrades Granite Ridge Resources to 'Buy' with 17.4% Upside Potential

Granite Ridge Resources (GRNT) has been upgraded to 'Buy' by Freedom analyst Sergey Pigarev, who sees 17.4% upside potential in the share price. The upgrade comes after a significant decline in the company's stock value despite continued pressure on its financial performance.

The company's revenue rose 36.7% year over year to $149.3 million in Q2 2026, driven by high oil prices. However, production dynamics were more modest, with oil production increasing 2.1% and natural gas production rising 0.9%. Total production grew 1.5% to 32 thousand barrels of oil equivalent per day.

Despite these challenges, management expects to accelerate production in the second half of the year and reach about 40 thousand barrels of oil equivalent per day by year-end. However, low realized natural gas prices remain a major concern for Granite Ridge Resources, which fell 51.7% year over year to $1.12 per thousand cubic feet.

The company's net debt rose to $418 million in the quarter, and interest expense increased 7.3% to $11.1 million. The Freedom analyst expects the company's cash flow to improve in 2027, supported by the expansion of gas transportation infrastructure and the commissioning of new LNG export capacity.