SM Energy (SM) to Sell Galvan Ranch Assets in $950 Million Deal
The share price of SM Energy Company (NYSE:SM) surged by 10.25% between February 13 and February 20, 2026, putting it among the Energy Stocks that Gained the Most This Week.
SM Energy Company (NYSE:SM) is an independent energy company focused on the exploration, exploitation, development, acquisition, and production of natural gas and crude oil in the United States.
On February 18, SM Energy Company (NYSE:SM) revealed that it had reached an agreement to sell its Galvan Ranch assets in South Texas. The $950 million deal comes as the energy operator looks to reduce debt and bolster its capital structure.
SM has decided to sell around 61,000 net acres and approximately 260 producing wells in its southern Maverick Basin position in Texas, along with related support facilities. These assets are expected to produce an average output of approximately 37-39 MBoe/d this year, and generate around $160 million in asset-level cash flows, excluding corporate burdens. As of the end of 2025, the net proved reserves associated with these assets were around 168 MMBoe. The deal is expected to close in the second quarter of 2026.
Beth McDonald, President and CEO of SM Energy Company (NYSE:SM), commented:
“This timely asset sale largely accomplishes one of our key priorities of selling more than $1.0 billion in assets, which will enable us to reduce debt and strengthen our capital structure. We are excited about the impact this divestiture has on our balance sheet and look forward to sharing our updated return‑of‑capital program when we report earnings next week.”
SM Energy Company (NYSE:SM) further received a boost on February 18 when Roth Capital raised its price target on the stock from $23 to $24, while maintaining a ‘Buy’ rating on the shares. Similarly, on the following day, Stephens also increased its price target on SM from $48 to $49, while keeping its ‘Overweight’ rating on the shares. The firm views the aforementioned divestiture by the company as ‘positive’.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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