Harbour Energy Shares ‘Attractive’ After Strong Q1 and Guidance Upgrade, Zeus Capital Says

Zeus Capital has maintained its Buy rating on Harbour Energy (LON: HBR) in a note on Tuesday, raising its price target to 322 pence from 320 pence after the oil and gas producer reported strong first-quarter operational performance and upgraded its full-year free cash flow guidance.

Analyst Daniel Slater said Harbour’s shareholder distribution policy and operational results, combined with elevated commodity prices, “offer an attractive yield for investors,” with Zeus Capital forecasting a dividend yield of 6.9% at the current share price based on a 45% free cash flow payout ratio for 2026.

Harbour reported first-quarter production of 506,000 barrels of oil equivalent per day, generating revenues of $3 billion and free cash flow of $700 million.

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The company raised its full-year production guidance to 480,000-500,000 barrels of oil equivalent per day and revised its free cash flow outlook to $1.4 billion, up from a prior $600 million forecast, reflecting higher assumed oil and gas prices.

Net debt rose to $6.3 billion at the end of the first quarter from $4.4 billion at year-end 2025, largely reflecting the $2.7 billion acquisition of US Gulf operator LLOG in February.

Zeus Capital said the deal has added scale and diversification to Harbour’s producing portfolio, with the company also progressing development projects across Norway, Egypt, Argentina, Mexico and the UK.

The shares are trading below Zeus Capital’s total risked net asset value of 322 pence, and the firm said it “continues to consider the shares attractive,” citing ongoing cash flows, post-acquisition deleveraging and a broad portfolio of development options.