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Matador (MTDR) Gains 1.2% Since Q2 Earnings Beat Estimates

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Matador Resources Company’s (MTDR - Free Report) shares have gained 1.2% since the second-quarter 2022 earnings announcement on Jul 26. The increase can be primarily attributed to the company’s second-quarter earnings beating the Zacks Consensus Estimate and its higher production guidance for 2022.

The upstream energy company reported adjusted earnings of $3.47 per share, beating the Zacks Consensus Estimate of $3.16 per share. The bottom line significantly improved from the year-ago quarter’s earnings of $1.02 per share.

Total quarterly revenues of $944 million surpassed the Zacks Consensus Estimate of $835 million. The top line also increased from the year-ago level of $357 million.

Strong quarterly earnings were driven by higher oil-equivalent production volumes and realizations of commodity prices.

In good news for investors, Matador increased the quarterly dividend to 10 cents per share, representing a 100% hike from 5 cents. The dividend is payable on Sept 1 to shareholders of record as of Aug 17.

Matador Resources Company Price, Consensus and EPS Surprise

 

Production

For second-quarter 2022, total production volume averaged 10,078 thousand barrels of oil equivalent (MBoe) (comprising 58% oil), higher than 8,482 MBoe a year ago.

The average oil production volume was 64,339 barrels per day (Bbls/d), up from 53,354 Bbls/d reported in second-quarter 2021. Natural gas production was 278.5 million cubic feet per day (MMcf/d), up from 239.1 MMcf/d a year ago.

Price Realization

The average realized price for oil (excluding realized derivatives) was $111.06 per barrel, which significantly increased from $64.90 in the year-ago quarter. Also, the natural gas price of $9.57 per thousand cubic feet was higher than $4.46 in the prior-year quarter.

Operating Expenses

The company’s production taxes, transportation and processing costs increased to $8.50 per barrel of oil equivalent (Boe) from $5.17 in the year-ago quarter. Plant and other midstream services’ operating expenses increased to $2.18 per Boe from the year-earlier figure of $1.62. Also, lease operating costs increased from $3.39 per Boe in second-quarter 2021 to $3.95.

Total operating expenses per Boe were recorded at $28.96, higher than the prior-year figure of $23.84.

Balance Sheet

As of Jun 30, 2022, Matador had cash and restricted cash of $282.3 million. Long-term debt was recorded at $1,320.3 million. Debt to capitalization was 32.5%.

Capital Spending

The company spent $143 million for the drilling, completing and equipping of wells in the second quarter, almost 24% lower than its projection. Enhanced operational efficiencies in the Delaware Basin primarily aided its performance.

Outlook

For 2022, Matador increased its oil-equivalent production guidance to 36.9-38.3 million barrels from the prior stated 36.3-38.3 million barrels. The metric suggests an improvement from 31.5 million oil-equivalent barrels reported last year. In the third quarter, the company expects to produce 100,000-102,000 oil-equivalent barrels per day.

Matador’s capital spending guidance for drilling, completing and equipping wells is pegged at $765-$835 million for the year, suggesting an increase from $640-$710 million mentioned earlier. In midstream, it expects to spend $50-$60 million for the year.

Zacks Rank

The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Snapshot of Other Upstream Energy Players

Pioneer Natural Resources Company (PXD - Free Report) reported second-quarter 2022 earnings of $9.36 per share (excluding one-time items), beating the Zacks Consensus Estimate of $8.81. Strong quarterly earnings were driven by higher oil-equivalent production volumes and commodity price realizations.

Pioneer has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Growth and B for Value. PXD is expected to see earnings growth of 151.7% for 2022.

ConocoPhillips (COP - Free Report) reported second-quarter 2022 adjusted earnings per share of $3.91, beating the Zacks Consensus Estimate of $3.78. The strong quarterly results were driven by higher oil-equivalent production volumes and realized commodity prices.

ConocoPhillips has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Growth and Value. COP is expected to see earnings growth of 143.6% for 2022.

Continental Resources, Inc. (CLR - Free Report) reported second-quarter 2022 adjusted earnings of $3.47 per share, beating the Zacks Consensus Estimate of $3.17. The strong quarterly earnings were driven by higher oil-equivalent production volumes and commodity price realizations.

Continental Resources has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Value and Growth. CLR is expected to see earnings growth of 155.6% for 2022.