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Matador (MTDR) Hits Fresh High: Is There Still Room to Run?
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Shares of Matador Resources (MTDR - Free Report) have been strong performers lately, with the stock up 13.6% over the past month. The stock hit a new 52-week high of $47.23 in the previous session. Matador Resources has gained 261.8% since the start of the year compared to the 38.7% move for the Zacks Oils-Energy sector and the 113.5% return for the Zacks Oil and Gas - Exploration and Production - United States industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on October 26, 2021, Matador reported EPS of $1.25 versus consensus estimate of $1.02 while it beat the consensus revenue estimate by 21.52%.
For the current fiscal year, Matador is expected to post earnings of $3.7 per share on $1.53 billion in revenues. This represents a 560.71% change in EPS on a 61.65% change in revenues. For the next fiscal year, the company is expected to earn $6.01 per share on $1.92 billion in revenues. This represents a year-over-year change of 62.54% and 25.52%, respectively.
Valuation Metrics
Matador may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Matador has a Value Score of C. The stock's Growth and Momentum Scores are A and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 11.8X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.9X versus its peer group's average of 5.8X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Matador currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Matador fits the bill. Thus, it seems as though Matador shares could still be poised for more gains ahead.
How Does Matador Stack Up to the Competition?
Shares of Matador have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also impressive, including PDC Energy , Callon Petroleum , and Pioneer Natural Resources , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 2% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Matador, even beyond its own solid fundamental situation.
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Matador (MTDR) Hits Fresh High: Is There Still Room to Run?
Shares of Matador Resources (MTDR - Free Report) have been strong performers lately, with the stock up 13.6% over the past month. The stock hit a new 52-week high of $47.23 in the previous session. Matador Resources has gained 261.8% since the start of the year compared to the 38.7% move for the Zacks Oils-Energy sector and the 113.5% return for the Zacks Oil and Gas - Exploration and Production - United States industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on October 26, 2021, Matador reported EPS of $1.25 versus consensus estimate of $1.02 while it beat the consensus revenue estimate by 21.52%.
For the current fiscal year, Matador is expected to post earnings of $3.7 per share on $1.53 billion in revenues. This represents a 560.71% change in EPS on a 61.65% change in revenues. For the next fiscal year, the company is expected to earn $6.01 per share on $1.92 billion in revenues. This represents a year-over-year change of 62.54% and 25.52%, respectively.
Valuation Metrics
Matador may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Matador has a Value Score of C. The stock's Growth and Momentum Scores are A and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 11.8X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.9X versus its peer group's average of 5.8X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Matador currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Matador fits the bill. Thus, it seems as though Matador shares could still be poised for more gains ahead.
How Does Matador Stack Up to the Competition?
Shares of Matador have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also impressive, including PDC Energy , Callon Petroleum , and Pioneer Natural Resources , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 2% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Matador, even beyond its own solid fundamental situation.