EOG Bulls Dig In Ahead of Wednesday's Print

EOG Resources heads into its August 5 earnings release with the bullish skew in options that defined last week's setup now even more pronounced — and short sellers continuing to retreat.

The call-heavy tilt in options has extended further since the July 25 note flagged the trend. The put/call ratio now reads 0.45, down from 0.49 a week ago and within a hair of the 52-week low of 0.44. At 1.3 standard deviations below its 20-day average, it is one of the most call-skewed readings of the past year. That shift tracks the stock's move: EOG has gained roughly 15% over the past month, closing at $148.69, and the options market has followed price higher rather than hedged against a reversal.

Short interest has continued to unwind since the prior article. Bears have cut positions by nearly 11% over the past week and almost 19% over the past month, leaving short interest at 3.1% of the free float — modest for an E&P of EOG's scale. Borrow conditions remain extremely loose, with availability at roughly 4,050% and a cost to borrow barely above 0.37%. There is no evidence of a squeeze dynamic and no sign of shorts rebuilding into the print.

The analyst community presents a more divided picture than positioning alone would suggest. Bulls point to EOG's transformation into a capital-return machine — 100% of FY25 free cash flow returned to shareholders, up from 48% in FY21 — and the Encino acquisition's optionality on Utica Shale volumes tied to LNG and data-centre demand growth. Susquehanna lifted its target to $170 recently while maintaining a Positive rating. But several houses trimmed targets through late June and early July — Citigroup cut to $141, Truist to $134, and Morgan Stanley moved to $156 — reflecting concern that commodity price volatility could squeeze the free cash flow story if oil weakens. The consensus target of roughly $158 sits about 6% above the current price, leaving limited implied upside relative to the 15% move already logged this month.

The earnings print on Wednesday will therefore test whether EOG's operational momentum — faster drilling times, lower well costs, and the Encino integration — can justify the re-rating the stock has already received, or whether the bears who trimmed targets ahead of this report had the better read on the near-term commodity backdrop.