Download PDF

1. Company Snapshot

1.a. Company Description

Matador 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.

Show Full description

1.b. Last Insights on MTDR

Matador Resources' recent performance was negatively impacted by weaker oil prices, which offset the gains from growth in oil production. The company's Q3 earnings beat estimates, but EPS declined 28% year-over-year to $1.36. Despite a 20% increase in quarterly cash dividend, investors are concerned about the sustainability of the company's profitability. Additionally, institutional investors such as William Blair Investment Management LLC and State of New Jersey Common Pension Fund D have been adjusting their holdings, with some reducing their stakes.

1.c. Company Highlights

2. Matador Resources' Strong Q3 2025 Earnings: A Closer Look

Matador Resources reported a robust financial performance in Q3 2025, with earnings per share (EPS) of $1.36, surpassing analyst estimates of $1.22. The company's revenue growth was driven by its upstream operations, with significant improvements in its financial metrics. The company's retained earnings stood at over $3 billion, a significant turnaround from the accumulated deficit just three and a half years ago. The leverage ratio was a comfortable 0.4, indicating a strong balance sheet. With a dividend increase of 20%, the company's commitment to returning value to shareholders is evident.

Publication Date: Oct -23

📋 Highlights
  • Dividend Increase & Retained Earnings:: 20% dividend hike; $3 billion in retained earnings (up from deficit in 3.5 years).
  • Strong Capital Allocation:: $2 billion liquidity; free cash flow directed to land, buybacks, and dividends with 50%+ project returns at $50 oil.
  • Capital Efficiency Gains:: $30–$45/lateral foot cost savings ($50–$60M total), enabling 2–5% 2026 organic growth with 12 new wells (half in Antelope Ridge).
  • Midstream Performance:: San Mateo processed 533 MMcf/day; $30–$40M EBITDA in 2025, $40–$50M in 2026.
  • Water Infrastructure Investment:: $40–$50M 2026 capital for water systems to reduce OPEX and capex, supporting 70–80% San Mateo revenue linkage.

Operational Efficiency and Cost Savings

The company's operational efficiency and cost savings were notable highlights in the quarter. COO Chris Calvert discussed the capital program, highlighting that the 12 additional wells added to the 2025 program have returns in excess of 50%. The company achieved well cost savings of $30 to $45 per lateral foot, resulting in $50 to $60 million in capital savings. This enables 2-5% organic growth in 2026. As Chris Calvert noted, the company has seen significant efficiency gains in completion operations and logistics, particularly with the use of treated produced water and recycled water for fracturing operations.

Valuation and Growth Prospects

Matador Resources' valuation metrics indicate a reasonable pricing. The P/E Ratio stands at 6.33, while the EV/EBITDA ratio is 3.18. The Dividend Yield is an attractive 2.99%. Analysts estimate revenue growth at 2.8% for next year. With a strong balance sheet and a history of making good decisions, the company is well-positioned for future growth. The midstream business, including San Mateo, is performing well, with a record 533,000,000 cubic feet per day of natural gas processed in the third quarter.

Midstream Business and Water Handling

The company's midstream business is expected to generate $30 to $40 million in EBITDA this year and $40 to $50 million next year. The company plans to invest $40 to $50 million in its wholly owned midstream business next year, partly to build out its water gathering system. This will help increase the use of produced water for hydraulic fracturing operations, reducing lease operating expenses and capital spend. With a strong program going into 2026, expecting the same or better VO per foot as seen in 2025, the company is poised for continued success.

Outlook and Conclusion

Matador Resources' management team emphasized the company's commitment to free cash flow, which is allocated towards land acquisition, opportunistic share buybacks, and dividend payments. With a solid inventory of projects with returns over 50% even at $50 oil, the company is well-positioned for future growth. As Joe Foran noted, the company has a history of making good decisions and has grown significantly over the past 40 years. The company's focus on operational efficiency, cost savings, and a strong balance sheet makes it an attractive investment opportunity.

3. NewsRoom

Card image cap

Edgestream Partners L.P. Decreases Holdings in Matador Resources Company $MTDR

Dec -06

Source: defenseworld.net

Card image cap

Matador Resources Company $MTDR Shares Sold by Fisher Asset Management LLC

Dec -03

Source: defenseworld.net

Card image cap

3 Stocks to Buy for a Volatile End to 2025

Nov -09

Source: investorplace.com

Card image cap

Matador Resources Company Provides Strategic Natural Gas Marketing Update

Oct -30

Source: businesswire.com

Card image cap

State of New Jersey Common Pension Fund D Raises Stock Holdings in Matador Resources Company $MTDR

Oct -30

Source: defenseworld.net

Card image cap

Matador (MTDR) Q3 Earnings: How Key Metrics Compare to Wall Street Estimates

Oct -27

Source: zacks.com

Card image cap

Matador (MTDR) Q3 Earnings: Taking a Look at Key Metrics Versus Estimates

Oct -24

Source: zacks.com

Card image cap

Matador Resources: Accelerates Development Activity In Late 2025

Oct -24

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.08%)

6. Segments

Exploration and Production

Expected Growth: 8%

Matador Resources Company's Exploration and Production segment growth is driven by increased oil and natural gas production, strategic acreage acquisitions, and improved operational efficiencies. Additionally, the company's focus on the Permian Basin, a region with high oil and gas reserves, contributes to its growth. Furthermore, Matador's hedging strategy and strong balance sheet enable it to capitalize on favorable market conditions, supporting its 8% growth rate.

Midstream

Expected Growth: 9%

Matador Resources Company's midstream segment growth is driven by increasing crude oil and natural gas production, strategic acquisitions, and expansion of gathering and transportation infrastructure. Additionally, the company's focus on operational efficiency, cost savings, and strong relationships with customers contribute to its 9% growth rate.

Consolidations and Eliminations

Expected Growth: 7%

Matador Resources Company's 7% growth is driven by strategic consolidations and eliminations, enhancing operational efficiency and reducing costs. Key drivers include increased oil production, improved well costs, and optimized drilling and completion activities. Additionally, the company's focus on high-return projects, disciplined capital allocation, and strong balance sheet management contribute to its growth momentum.

7. Detailed Products

Oil

Matador Resources Company is an independent oil and natural gas company engaged in the exploration, development, and production of oil and natural gas resources in the United States.

Natural Gas

Matador Resources Company explores, develops, and produces natural gas resources in the United States, with a focus on the Permian Basin and the Eagle Ford Shale.

Natural Gas Liquids (NGLs)

Matador Resources Company produces NGLs, including ethane, propane, and butane, as a byproduct of its natural gas production.

Crude Oil Midstream Services

Matador Resources Company provides midstream services, including crude oil gathering, transportation, and storage, to support its oil production operations.

8. Matador Resources Company's Porter Forces

Forces Ranking

Threat Of Substitutes

Matador Resources Company operates in the oil and gas industry, which has few substitutes. However, the increasing adoption of renewable energy sources and electric vehicles poses a moderate threat to the company's operations.

Bargaining Power Of Customers

Matador Resources Company's customers, primarily oil and gas refineries, have limited bargaining power due to the company's diversified customer base and the lack of alternative suppliers.

Bargaining Power Of Suppliers

Matador Resources Company's suppliers, primarily oilfield service companies, have moderate bargaining power due to the company's dependence on their services and the limited number of suppliers in the market.

Threat Of New Entrants

The threat of new entrants in the oil and gas industry is low due to the high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The oil and gas industry is highly competitive, with many established players competing for market share. Matador Resources Company faces intense rivalry from its peers, which can lead to downward pressure on prices and profit margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 36.46%
Debt Cost 7.57%
Equity Weight 63.54%
Equity Cost 20.57%
WACC 15.83%
Leverage 57.38%

11. Quality Control: Matador Resources Company passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Matador Resources

A-Score: 6.0/10

Value: 8.4

Growth: 8.8

Quality: 7.4

Yield: 4.0

Momentum: 3.0

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
Permian Resources

A-Score: 6.0/10

Value: 6.6

Growth: 7.8

Quality: 6.6

Yield: 6.0

Momentum: 3.5

Volatility: 5.3

1-Year Total Return ->

View Full Report
Stock-Card
Magnolia Oil & Gas

A-Score: 5.8/10

Value: 6.0

Growth: 6.6

Quality: 7.1

Yield: 5.0

Momentum: 3.5

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
SM Energy

A-Score: 5.3/10

Value: 9.4

Growth: 5.7

Quality: 6.8

Yield: 5.0

Momentum: 1.5

Volatility: 3.7

1-Year Total Return ->

View Full Report
Stock-Card
Chesapeake Energy

A-Score: 4.9/10

Value: 5.1

Growth: 1.6

Quality: 6.1

Yield: 8.0

Momentum: 5.0

Volatility: 3.3

1-Year Total Return ->

View Full Report
Stock-Card
Crescent Energy

A-Score: 4.7/10

Value: 6.9

Growth: 4.3

Quality: 4.2

Yield: 8.0

Momentum: 1.0

Volatility: 3.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

45.22$

Current Price

45.22$

Potential

-0.00%

Expected Cash-Flows