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Here's Why Hold Strategy is Apt for Matador (MTDR) Stock
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Matador Resources Company (MTDR - Free Report) is a leading upstream player, having a strong foothold in prolific oil and natural gas shale and other unconventional plays. For this year, the Zacks Consensus Estimate for the firm’s earnings per share is pegged at $6.09.
What’s Favoring the Stock?
The price of West Texas Intermediate crude, trading at more than $80 per barrel, is highly favorable for exploration and production activities. Handsome crude price is likely to aid MTDR, carrying a Zacks Rank #3 (Hold), in increasing production volumes. For 2023, the company revised its total oil production guidance to 26.8-27.5 million Bbl from the prior view of 26.4-27.3 million Bbl. The recently guided production data suggest a year-over-year increase of 24%.
On another positive note, Matador plans to turn to sales a net of 98.4 wells this year — including operated and non-operated wells. Its prime priorities include lowering debt, delivering free cashflows and maintaining or increasing dividends.
Risks
However, rising lease operating expenses are hurting the company’s bottom line. Also, being an upstream energy player, Matador’s business is highly vulnerable to extreme volatility in commodity prices.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Oceaneering International is well placed on improving oil prices since it is a leading provider of engineered services and products and robotic solutions to the energy companies working offshore. Higher oil price is supporting increased upstream activities, which, in turn, will improve demand for Oceaneering’s drilling and completions support services.
Murphy, a leading retailer of gasoline and convenience merchandise, has a solid business model.
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Here's Why Hold Strategy is Apt for Matador (MTDR) Stock
Matador Resources Company (MTDR - Free Report) is a leading upstream player, having a strong foothold in prolific oil and natural gas shale and other unconventional plays. For this year, the Zacks Consensus Estimate for the firm’s earnings per share is pegged at $6.09.
What’s Favoring the Stock?
The price of West Texas Intermediate crude, trading at more than $80 per barrel, is highly favorable for exploration and production activities. Handsome crude price is likely to aid MTDR, carrying a Zacks Rank #3 (Hold), in increasing production volumes. For 2023, the company revised its total oil production guidance to 26.8-27.5 million Bbl from the prior view of 26.4-27.3 million Bbl. The recently guided production data suggest a year-over-year increase of 24%.
On another positive note, Matador plans to turn to sales a net of 98.4 wells this year — including operated and non-operated wells. Its prime priorities include lowering debt, delivering free cashflows and maintaining or increasing dividends.
Risks
However, rising lease operating expenses are hurting the company’s bottom line. Also, being an upstream energy player, Matador’s business is highly vulnerable to extreme volatility in commodity prices.
Stocks to Consider
Better-ranked players in the energy space include Evolution Petroleum Corporation (EPM - Free Report) , Oceaneering International, Inc. (OII - Free Report) and Murphy USA (MUSA - Free Report) . All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Oceaneering International is well placed on improving oil prices since it is a leading provider of engineered services and products and robotic solutions to the energy companies working offshore. Higher oil price is supporting increased upstream activities, which, in turn, will improve demand for Oceaneering’s drilling and completions support services.
Murphy, a leading retailer of gasoline and convenience merchandise, has a solid business model.