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Matador (MTDR) Earnings Beat Estimates in Q2, Reserves Grow

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Matador Resources Company (MTDR - Free Report) reported second-quarter 2018 adjusted earnings of 41 cents per share, beating the Zacks Consensus Estimate of 33 cents and improving from the year-ago profit of 11 cents.

Revenues of $211.4 million steered past the Zacks Consensus Estimate of $184 million and rose from the year-ago quarter’s $129.6 million.

Delaware Basin production and increased realized crude price backed the strong second-quarter results. Importantly, management pointed that the April-to-June quarter has been the best since the inception of the company.

Production & Price Realization

During second-quarter 2018, total production volumes averaged 4,817 thousand barrels of oil equivalent (MBOE) (56.2% oil), higher than 3,360 MBOE a year ago. The net production volumes of oil were recorded at 2,706 thousand barrels (MBbl), up from 1,767 MBbl in second-quarter 2017. Record oil-equivalent production in the Delaware Basin aided the quarterly volumes.

Realized price for oil (including derivatives) was recorded at $60.52 per barrel, up from $46.34 in the year-ago quarter. However, natural gas price of $3.38 per thousand cubic feet (Mcf) was marginally lower than $3.39 in the prior-year quarter.  

Financials & Capital Spending

As of Jun 30, 2018, the company reported cash and restricted cash of $143.5 million and debt of $574.2 million, with a debt-to-capitalization ratio of 25.5%. 

The company spent $182.8 million through the second quarter of 2018. To drill, equip and complete wells, Matador allocated $166.1 million of the total amount. While the remaining $16.7 million was expended for midstream operations.

Reserves Grow

As of Jun 30, 2018, Matador estimated proved reserves of 170,155 MBOE, up from 152,771 MBOE as of Dec 31, 2017.

Guidance

Matador raised its 2018 production guidance to 18.3-18.7 million barrels of oil equivalent (BOE) from the prior 16.5-17.3 million BOE.

Through 2018, the company has maintained capital spending for midstream activities at $70 to $90 million. However, for drilling, completing and equipping wells, Matador is planning to spend $620 to $650 million, higher than its prior guidance of $530 to $570 million.

Through 2018, the company expects to complete and bring 151 gross wells online, higher than its original projection of 128 wells.

Matador Resources Company Price, Consensus and EPS Surprise

 

Matador Resources Company Price, Consensus and EPS Surprise | Matador Resources Company Quote

Zacks Rank & Stocks to Consider

Matador carries a Zacks Rank #3 (Hold). Meanwhile, a few better-ranked players in the energy space are Northern Oil and Gas, Inc. (NOG - Free Report) , McDermott International, Inc. and Murphy Oil Corp. (MUR - Free Report) . While Murphy Oil carries a Zacks Rank #2 (Buy), McDermott and Northern Oil sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here

Northern Oil beat the Zacks Consensus Estimate in three of the prior four quarters, the average positive earnings surprise being 160.4%.

McDermott’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average positive surprise being 101.7%.

Murphy Oil’s bottom line surpassed the consensus mark in each of the last four quarters, the average positive surprise being 102.5%.

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