Gas company hit with bad news from major banks amid ongoing challenges: 'Downside risk'

The gas company CNX Resources is facing a bleak financial outlook after financial institutions cut their price targets for the stock. Bank of America trimmed its projection from $32 to $27 while maintaining an "underperform" rating, MarketBeat reported.

This downgrade isn't an isolated incident. Morgan Stanley set a $33 price target with an "underweight" rating in March, while Mizuho decreased its target from $38 to $34 with an "underperform" classification.

Nine analysts rated the stock as a "sell," five went with "hold," and just one offered a "buy" recommendation, creating a consensus "reduce" rating.

These negative assessments reflect broader concerns about dirty fuel companies. Long-term investments in gas and oil producers are becoming riskier as the global economy transitions from dirty energy sources to cleaner ones.

Companies such as CNX Resources, which focuses on gas production in the Appalachian Basin, face challenges as clean energy costs fall. While dirty fuel stocks once represented reliable growth opportunities, many are now underperforming.

The financial community's pessimism about CNX — with a trading price around $31, down from a 52-week high of nearly $42 — suggests that people are questioning such investments' long-term viability.

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This trend doesn't just affect CNX. Recent market data shows that other dirty energy companies are struggling with lower profit margins and regulatory pressures.

Meanwhile, clean energy firms attract investment capital, create sustainable jobs, and generate competitive returns. Though early environmental, social, and governance investment strategies may have had mixed results, the momentum toward cleaner energy solutions remains strong.

"CNX Resources had a positive return on equity of 6.72% and a negative net margin of 7.14%," MarketBeat noted. "On average, analysts expect that CNX Resources will post 2.18 [earnings per share] for the current fiscal year."

Raymond James analyst John Freeman recently upgraded CNX from "underperform" to "market perform," stating, "While significant headwinds remain for natural gas producers in the current price environment, we believe much of the downside risk is now priced into the stock at current levels."