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Matador Resources Company (MTDR)
NYSE:MTDR
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Matador Resources
(NYSE:MTDR)
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Rating:70Outperform
Price Target:
$50.00
▲(18.62% Upside)
Matador Resources' strong financial performance and attractive valuation are key strengths, supporting a solid overall score. However, technical indicators suggest bearish momentum, which tempers the overall outlook. The absence of recent earnings call data and corporate events limits additional insights.
Positive Factors
Revenue Growth
The strong revenue growth of 16.2% year-over-year indicates robust demand and successful operational strategies, enhancing long-term market position.
Cash Flow Strength
Strong operating cash flow supports future investments and indicates effective cash generation, crucial for sustaining growth and financial health.
Management Quality
The promotion of an experienced internal candidate to CFO reflects stable management and continuity, which can positively influence strategic execution.
Negative Factors
Net Income Decline
A decline in net income suggests potential challenges in maintaining profitability, necessitating careful cost management and strategic adjustments.
High Capital Expenditures
Significant capital expenditures may strain cash flow, requiring careful planning to ensure investments yield sufficient returns and maintain liquidity.
Debt Management
Rising liabilities necessitate careful debt management to avoid financial strain, ensuring the company maintains a balanced leverage position.
Matador Resources (MTDR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.56B
Dividend Yield2.82%
Average Volume (3M)1.64M
Price to Earnings (P/E)6.5
Beta (1Y)0.97
Revenue Growth16.20%
EPS Growth-12.42%
CountryUS
Employees452
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)1.53
Shares Outstanding124,494,420
10 Day Avg. Volume1,910,107
30 Day Avg. Volume1,644,940
Financial Highlights & Ratios
PEG Ratio9.29
Price to Book (P/B)1.37
Price to Sales (P/S)2.00
P/FCF Ratio24.82
Enterprise Value/Market Cap1.71
Enterprise Value/Revenue2.52
Enterprise Value/Gross Profit6.11
Enterprise Value/Ebitda3.70
Forecast
1Y Price Target
$62.25Price Target Upside47.69% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering17
Matador Resources Business Overview & Revenue Model
Company DescriptionMatador Resources Company, an independent energy company, engages in the exploration, development, production, and acquisition of oil and natural gas resources in the United States. It operates through two segments, Exploration and Production; and Midstream. The company primarily holds interests in the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. It also operates the Eagle Ford shale play in South Texas; and the Haynesville shale and Cotton Valley plays in Northwest Louisiana. In addition, the company conducts midstream operations in support of its exploration, development, and production operations; provides natural gas processing and oil transportation services; and offers oil, natural gas, and produced water gathering services, as well as produced water disposal services to third parties. As of December 31, 2021, its estimated total proved oil and natural gas reserves were 323.4 million barrels of oil equivalent, including 181.3 million stock tank barrels of oil and 852.5 billion cubic feet of natural gas. The company was formerly known as Matador Holdco, Inc. and changed its name to Matador Resources Company in August 2011. Matador Resources Company was founded in 2003 and is headquartered in Dallas, Texas.
How the Company Makes MoneyMatador Resources generates revenue primarily through the sale of crude oil, natural gas, and natural gas liquids (NGLs) produced from its operations. The company employs a revenue model based on the extraction and sale of these hydrocarbons at market prices. Key revenue streams include the direct sales of oil and gas to various purchasers, which can include large oil companies, midstream companies, and end-users. Additionally, Matador often enters into hedging contracts to manage price volatility, providing a more stable revenue stream. The company also benefits from cost efficiencies in its drilling and production processes, which can enhance profitability. Strategic partnerships with service providers and midstream companies further support its operations, allowing for effective transportation and processing of its products, ultimately contributing to its earnings.
Matador Resources Earnings Call Summary
Earnings Call Date:Jul 22, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:Oct 21, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong position for Matador Resources, with significant debt repayment, increased gas processing capacity, and insider confidence through share purchases. While there is some concern about production slowdown and market volatility affecting midstream plans, the overall outlook is optimistic with substantial projected growth and a record second quarter anticipated.Q1-2025 Updates
Positive Updates
Debt Repayment and Financial Flexibility
Matador Resources repaid $190 million of its debt, enhancing its financial flexibility and optionality for future plans.
Record Gas Processing Capacity
The Marlin plant is coming online, and combined with the Merlin and Black River plants, will provide a processing capacity of 720 million cubic feet per day, significantly higher than the original plant's capacity of 60 million.
Insider Confidence and Share Repurchase
The board authorized a repurchase of shares, and over 100 employees, including management, bought shares, indicating high insider confidence.
Projected Growth by Year End
Despite a temporary production slowdown, the company projects a 17% increase in oil production by the end of the year.
Successful Reserve Replacement
In the first quarter, Matador not only replaced the reserves that were produced but also added to them, ensuring a 10-15 year runway of valuable locations.
Dividend Commitment
The company has increased its dividend six times in four years, demonstrating a commitment to returning value to shareholders.
Record Second Quarter Expected
The second quarter is projected to be a record quarter for production with the turning on of 40 wells.
Negative Updates
Production Slowdown
Production slowed down slightly due to maintenance and force majeure events, leading to a temporary 1-2% reduction.
Market Volatility and Midstream Uncertainty
Volatility in the broader market has impacted decision-making regarding the midstream segment, including the potential for an IPO.
Company Guidance
In the first quarter of 2025, Matador Resources Company provided several key metrics and strategic decisions during their earnings call. They announced a repayment of $190 million in debt, enhancing financial flexibility amid challenging market conditions. The company highlighted a significant increase in gas processing capacity, with the Marlin plant coming online, boosting total capacity to 720 million cubic feet per day, up from the original 60 million at Black River. This expanded capacity offers critical flow assurance. Matador emphasized its commitment to shareholder alignment, authorizing a share repurchase program and reporting that management and employees collectively engaged in 31 stock transactions. Despite a temporary 1-2% dip in production due to maintenance and force majeure events, the company projected a 17% growth in oil production by year-end. The call also revealed a hedging strategy extending into 2026 to mitigate capacity risks and protect against market volatility. Matador's leadership stressed the company's preparedness to adapt to changing conditions, with options to increase capital expenditures, pursue acquisitions, or execute share buybacks as market conditions evolve.Matador Resources Financial Statement Overview
Summary
Matador Resources exhibits solid financial health with strong revenue growth and profitability metrics. The balance sheet indicates effective use of leverage and solid equity positioning. Cash flow is robust, supporting future investments. Monitoring of net income fluctuations and capital expenditure levels will be crucial for sustained performance.Income Statement
Matador Resources has demonstrated strong revenue growth with a notable increase in total revenue from $862M in 2020 to $3,762M TTM. The gross profit margin has improved significantly over the years, indicating efficient cost management. The net profit margin remained robust at 22.7% TTM, showcasing profitability. Strong EBIT and EBITDA margins further highlight operational efficiency. However, a slight decline in net income from 2024 to TTM suggests a need for cautious monitoring.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio is 0.61, indicating a balanced leverage position. With a return on equity of 15.9% TTM, Matador Resources is effectively utilizing shareholder funds to generate profits. The equity ratio of 47.6% reflects a stable financial structure. While total assets have grown, total liabilities have also increased, necessitating careful management of financial commitments.78
Positive
Cash Flow
Operating cash flow has been strong, with a notable increase to $2,414M TTM. The free cash flow growth rate of 57.5% from 2024 to TTM is impressive, supporting potential for further investments. The operating cash flow to net income ratio is 2.83, indicating effective cash generation from operations. However, high capital expenditures require ongoing evaluation to ensure sustainable cash flow.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.76B | 3.48B | 2.82B | 3.06B | 1.66B | 862.13M |
| Gross Profit | 1.55B | 1.54B | 1.33B | 1.88B | 891.54M | 227.77M |
| EBITDA | 2.57B | 2.42B | 1.94B | 2.23B | 1.14B | -353.67M |
| Net Income | 853.13M | 885.32M | 846.07M | 1.21B | 584.97M | -553.56M |
Balance Sheet | ||||||
| Total Assets | 11.28B | 10.85B | 7.73B | 5.55B | 4.26B | 3.69B |
| Cash, Cash Equivalents and Short-Term Investments | 86.79M | 23.03M | 52.66M | 505.18M | 48.13M | 57.92M |
| Total Debt | 3.29B | 3.46B | 2.27B | 1.16B | 1.53B | 1.81B |
| Total Liabilities | 5.55B | 5.46B | 3.60B | 2.24B | 2.13B | 2.17B |
| Stockholders Equity | 5.37B | 5.09B | 3.91B | 3.11B | 1.91B | 1.29B |
Cash Flow | ||||||
| Free Cash Flow | 441.06M | 280.04M | 318.02M | 894.75M | 319.88M | -302.87M |
| Operating Cash Flow | 2.41B | 2.25B | 1.87B | 1.98B | 1.05B | 477.58M |
| Investing Cash Flow | -3.56B | -3.67B | -3.21B | -1.04B | -729.26M | -775.67M |
| Financing Cash Flow | 1.17B | 1.41B | 902.33M | -480.85M | -328.55M | 324.34M |
Matador Resources Technical Analysis
Negative
42.15
Price Trends
47.08
Negative
47.74
Negative
48.79
Negative
Market Momentum
-1.10
Positive
36.44
Neutral
20.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MTDR, the sentiment is Negative. The current price of 42.15 is below the 20-day moving average (MA) of 45.87, below the 50-day MA of 47.08, and below the 200-day MA of 48.79, indicating a bearish trend. The MACD of -1.10 indicates Positive momentum. The RSI at 36.44 is Neutral, neither overbought nor oversold. The STOCH value of 20.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MTDR.
Matador Resources Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $8.80B | 8.25 | 19.09% | 4.56% | 12.13% | -67.53% | |
74 Outperform | $4.59B | 12.55 | 19.24% | 2.56% | 2.67% | -5.79% | |
70 Outperform | $5.50B | 24.57 | 3.13% | 5.89% | 19.55% | -81.10% | |
70 Outperform | $5.56B | 6.55 | 17.07% | 2.82% | 16.20% | -12.42% | |
66 Neutral | $4.61B | 54.13 | 3.73% | ― | 38.21% | -67.24% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
52 Neutral | $6.03B | ― | -3.18% | 0.66% | 17.60% | -385.47% |
* Energy Sector Average
MTDR
Matador Resources
42.15
-10.24
-19.55%
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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.