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Granite Ridge Resources (GRNT)
NYSE:GRNT
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Granite Ridge Resources
(NYSE:GRNT)
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Rating:69Neutral
Price Target:
$6.00
▲(7.91% Upside)
Granite Ridge Resources receives a solid overall score driven by strong financial performance and positive earnings call sentiment. The company's robust cash flow and stable balance sheet are significant strengths. While the technical analysis shows mixed signals, the attractive dividend yield provides a compensating factor. The raised production guidance and strategic growth initiatives further enhance the company's outlook.
Positive Factors
Production Growth
The significant production growth, especially in oil and natural gas, indicates strong operational capabilities and market demand, supporting long-term revenue expansion.
Cash Flow Generation
Strong cash flow generation enhances financial flexibility, enabling strategic investments and debt management, crucial for sustainable growth.
Strategic Partnerships
Strategic partnerships in key regions unlock substantial value and enhance operational efficiency, positioning the company for long-term competitive advantage.
Negative Factors
Declining Oil Prices
Falling oil prices can compress margins and reduce profitability, posing a risk to revenue stability and financial performance over time.
Increased Operating Expenses
Rising operating expenses can erode profit margins, impacting the company's ability to maintain cost efficiency and competitiveness.
Higher Administrative Costs
Increased administrative costs, including nonrecurring expenses, can strain profitability and limit funds available for growth initiatives.
Granite Ridge Resources (GRNT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$729.74M
Dividend Yield7.91%
Average Volume (3M)547.75K
Price to Earnings (P/E)22.3
Beta (1Y)0.92
Revenue Growth9.54%
EPS Growth-42.85%
CountryUS
Employees3
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.11
Shares Outstanding131,247,820
10 Day Avg. Volume553,886
30 Day Avg. Volume547,749
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.50
Enterprise Value/Revenue2.52
Enterprise Value/Gross Profit5.43
Enterprise Value/Ebitda4.22
Forecast
1Y Price Target
$7.40Price Target Upside33.09% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Granite Ridge Resources Business Overview & Revenue Model
Company DescriptionGranite Ridge Resources, Inc. manages private funds with interests in areas of the Midland, Delaware, Bakken, Eagle Ford, DJ, and Haynesville play. It invests in oil and gas exploration and production. The company is based in Dallas, Texas.
How the Company Makes MoneyGranite Ridge Resources generates revenue through the extraction and sale of oil and natural gas. The company acquires and develops oil and gas properties, often investing in exploration activities to discover new reserves. Once these resources are extracted, they are sold on the open market, where prices can fluctuate based on global supply and demand dynamics. Key revenue streams for Granite Ridge Resources include the sale of crude oil, natural gas, and related products. The company may also engage in strategic partnerships and joint ventures to enhance its exploration and production capabilities, which can contribute to its earnings. Additionally, efficient management of operational costs and investments in technology to improve extraction methods can impact the company's profitability.
Granite Ridge Resources Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Positive
The earnings call presented a largely positive outlook with significant production increases, raised guidance, and strong financial performance. However, challenges such as declining oil prices, increased operating expenses, and higher general administrative costs were noted. Despite these lowlights, the strategic growth initiatives and financial health indicate a predominantly positive sentiment.Q2-2025 Updates
Positive Updates
Significant Production Increase
Granite Ridge Resources reported a 37% year-over-year increase in production to 31,576 barrels of oil equivalent per day, with a 46% rise in oil production and a 28% rise in natural gas production.
Raised Production and CapEx Guidance
The company raised its full year production guidance by 10% at the midpoint to between 31,000 and 33,000 barrels of oil equivalent per day and increased its capital expenditure guidance to an all-in range of $400 million to $420 million.
Strong Financial Performance
Granite Ridge reported a total oil and gas sales revenue of $109.2 million, a 20% increase compared to Q2 2024, and a net income for the quarter of $25.1 million, or $0.19 per share.
Increased Operational Capacity
The company reported securing 3 additional years of inventory at an attractive entry cost of $1.7 million per location, with plans to deploy $120 million in acquisition capital adding 74 net locations.
Negative Updates
Decline in Realized Oil Prices
The company experienced a 21% decline in realized oil prices from $77.84 per barrel in the prior year period to $61.41 this quarter.
Increased Operating Expenses
Lease operating expenses rose to $20.1 million or $7 per BOE, compared to $13.7 million or $6.50 per BOE in Q2 2024, reflecting elevated service and higher saltwater disposal costs.
Higher General and Administrative Expenses
General and administrative expenses increased by $1.9 million year-over-year to $8.5 million, driven by nonrecurring expenses including $1.7 million in severance expense and $1.1 million related to capital markets activities.
Company Guidance
During the second quarter of 2025 earnings call, Granite Ridge Resources provided updated guidance, raising their full-year production expectations by 10% to between 31,000 and 33,000 barrels of oil equivalent per day, marking a 28% year-over-year growth. The company also increased its capital expenditure guidance to a range of $400 million to $420 million, driven by unbudgeted acquisitions expected to close in 2025. Granite Ridge highlighted its successful strategy of partnering with top-tier operators, particularly in the Permian Basin, to unlock substantial value. This approach has led to a production increase of 37% year-over-year, with oil production rising by 46% and natural gas production by 28%. Despite a 21% decline in realized oil prices, the company's net income for the quarter was $25.1 million, or $0.19 per share. Granite Ridge's balance sheet remains strong with a leverage ratio of 0.8x net debt to adjusted EBITDA, and the company plans to continue exploring credit markets to bolster liquidity.Granite Ridge Resources Financial Statement Overview
Summary
Granite Ridge Resources exhibits solid financial health with strong operational efficiency and cash flow generation. While revenue and gross profit margins are strong, net profitability remains a concern due to high non-operating expenses. The balance sheet is stable with manageable leverage, but declining return on equity suggests profitability issues. Overall, the company is well-positioned in terms of cash flow, but needs to address profitability challenges to enhance financial performance.Income Statement
Granite Ridge Resources shows a strong gross profit margin of 48.4% TTM, indicating effective cost management. However, the net profit margin is relatively low at 3.0% TTM, suggesting challenges in controlling non-operating expenses. Revenue growth is positive, with a 9.0% increase from 2024 to TTM, but historical volatility is noted with a decline in 2022. The EBIT margin is moderate at 19.9% TTM, while the EBITDA margin is robust at 53.4% TTM, reflecting strong operational efficiency.65
Positive
Balance Sheet
The company maintains a healthy equity ratio of 58.1% TTM, indicating a strong capital structure. The debt-to-equity ratio is 0.40 TTM, showing manageable leverage. However, the return on equity has decreased significantly to 2.0% TTM from 29.6% in 2022, highlighting potential profitability challenges. Overall, the balance sheet reflects stability but with declining returns.70
Positive
Cash Flow
Granite Ridge Resources demonstrates strong cash flow management with a significant operating cash flow to net income ratio of 33.7 TTM, indicating robust cash generation relative to earnings. Free cash flow has improved substantially to $128.5 million TTM from negative figures in previous years, showcasing effective capital expenditure management. The free cash flow to net income ratio is 10.4 TTM, reflecting healthy cash flow relative to earnings.75
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 432.53M | 380.03M | 394.07M | 497.42M | 290.19M | 81.10M |
| Gross Profit | 201.00M | 120.03M | 145.18M | 422.12M | 151.13M | 60.04M |
| EBITDA | 258.95M | 219.97M | 271.56M | 382.94M | 205.50M | 62.94M |
| Net Income | 32.33M | 18.76M | 81.10M | 262.34M | 108.46M | -23.93M |
Balance Sheet | ||||||
| Total Assets | 6.78M | 1.04B | 927.10M | 794.78M | 17.00M | 40.78M |
| Cash, Cash Equivalents and Short-Term Investments | 3.74M | 41.20M | 60.86M | 50.83M | 11.85M | 1.29M |
| Total Debt | 275.00M | 205.00M | 110.00M | 0.00 | 51.10M | 6.40M |
| Total Liabilities | 462.50M | 401.13M | 255.46M | 172.37M | 2.02M | 7.57M |
| Stockholders Equity | 642.47M | 635.35M | 671.64M | 622.40M | 474.93M | 404.12M |
Cash Flow | ||||||
| Free Cash Flow | 328.24M | -71.26M | -56.33M | 111.70M | -213.81M | -50.58M |
| Operating Cash Flow | 429.87M | 275.73M | 302.87M | 346.39M | 5.47M | 66.81M |
| Investing Cash Flow | -511.30M | -310.77M | -356.68M | -230.56M | 21.28M | -116.74M |
| Financing Cash Flow | 74.45M | 33.72M | 13.41M | -76.85M | 8.49M | 52.07M |
Granite Ridge Resources Technical Analysis
Positive
5.56
Price Trends
5.33
Positive
5.51
Positive
5.53
Positive
Market Momentum
0.03
Positive
53.11
Neutral
23.73
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GRNT, the sentiment is Positive. The current price of 5.56 is above the 20-day moving average (MA) of 5.48, above the 50-day MA of 5.33, and above the 200-day MA of 5.53, indicating a bullish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 53.11 is Neutral, neither overbought nor oversold. The STOCH value of 23.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GRNT.
Granite Ridge Resources Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $907.42M | 22.51 | 6.49% | 9.41% | 3.96% | 29.26% | |
72 Outperform | $600.87M | 6.01 | 18.30% | 5.58% | -4.93% | -7.56% | |
69 Neutral | $729.74M | 22.26 | 4.90% | 7.91% | 9.54% | -42.85% | |
66 Neutral | $837.66M | ― | ― | ― | ― | ― | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
56 Neutral | $675.26M | 2.02 | -30.17% | ― | 5.26% | -309.56% |
* Energy Sector Average
GRNT
Granite Ridge Resources
5.56
-0.16
-2.80%
VTLE
Vital Energy
17.11
-12.18
-41.58%
REPX
Riley Exploration Permian
27.26
0.81
3.06%
VTS
Vitesse Energy, Inc.
23.50
0.11
0.47%
TXO
TXO Energy Partners LP
14.49
-2.41
-14.26%
INR
Infinity Natural Resources, Inc. Class A
13.76
-8.13
-37.14%
Granite Ridge Resources Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
Granite Ridge Resources Reports 37% Production Increase
Positive
Aug 7, 2025
On August 7, 2025, Granite Ridge Resources reported a 37% increase in daily production to 31,576 barrels of oil equivalent per day for the second quarter of 2025, compared to the same period in 2024. The company announced a net income of $25.1 million and declared a quarterly dividend of $0.11 per share. The company raised its full-year production guidance by 10% and increased capital expenditure guidance to support expanded inventory additions, indicating strong operational performance and strategic growth initiatives.
The most recent analyst rating on (GRNT) stock is a Buy with a $8.80 price target. To see the full list of analyst forecasts on Granite Ridge Resources stock, see the GRNT Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.