Company Overview
Matador Resources Company functions as an independent energy entity dedicated to the acquisition, exploration, development, and production of oil and natural gas resources within the United States. The firm operates specifically within the Energy sector and the Oil & Gas E&P industry, where it manages assets through two distinct segments: Exploration and Production, and Midstream. The company's scale is defined by a market capitalization of $8.13B, annual revenue of $3.66B, and an employed workforce of 483 individuals. These financial metrics indicate that Matador Resources operates as a substantial player with significant revenue generation capabilities, positioning it as a notable participant in the domestic upstream energy landscape while maintaining a specialized focus on resource extraction and midstream infrastructure support.
Financial Health
The company reported revenue of $3.66B and net income of $759.22M over the trailing twelve months, with EBITDA standing at $2.43B. The substantial gap between the $3.66B revenue and the $759.22M net income reveals a robust cost structure where operating expenses, taxes, and interest deductibles consume approximately 79.2% of total revenue before arriving at the bottom line. However, the free cash flow stands at -$170,397,248, which indicates that the company is currently generating negative cash flow from operations after capital expenditures, suggesting a need for external financing or asset monetization to fund growth or maintain liquidity. The gross margin is 79.7%, reflecting the high profitability of the extraction process before operating costs; the operating margin is 24.1%, showing the efficiency of core business operations after overhead; and the profit margin is 20.8%, representing the final earnings power relative to sales. On the balance sheet, total cash amounts to $15.31M while total debt reaches $3.55B, resulting in a debt-to-equity ratio of 59.18, which characterizes the balance sheet as highly leveraged rather than conservative. The current ratio is 0.79, indicating that current assets fall short of current liabilities and signaling potential short-term liquidity constraints that require careful cash management. Management effectiveness is further illuminated by a return on equity of 15.0% and a return on assets of 6.8%, metrics that demonstrate the company's ability to generate significant returns for shareholders relative to the equity invested and overall asset base utilized.
Valuation Assessment
The trailing twelve-month P/E ratio is 10.75, while the forward P/E ratio is 9.44, implying that the market expects earnings growth in the coming year that would justify a lower multiple on future projections compared to historical performance. The price-to-book ratio is 1.44, which indicates that the market values the company at 44% above its book value, reflecting a premium assigned to its underlying assets and resource base. Alternative valuation metrics such as the price-to-sales ratio of 2.22 and an EV/EBITDA of 4.94 provide a broader perspective on valuation relative to revenue generation and earnings before interest, taxes, depreciation, and amortization, suggesting the stock is priced moderately relative to its sales and adjusted earnings power. The 52-week high is $65.75 and the 52-week low is $35.19, placing the current trading environment within a wide historical range that captures significant volatility over the past year. With a beta of 1.05, the stock exhibits price volatility that is slightly higher than the broader market, meaning it tends to move with slightly more intensity than the overall market index during periods of fluctuation.
Growth & Income
The revenue growth year-over-year is -12.5%, while earnings growth year-over-year is -9.6%, indicating that earnings are declining at a slower rate than revenue, which implies that the company's cost structure or operational efficiency has partially insulated profitability from the broader decline in sales volume. The dividend yield is 2.3%, and the payout ratio is 21.6%, suggesting that the dividend is sustainable given the current earnings level as the payout consumes only a small fraction of generated profits. Given the negative free cash flow and declining revenue growth, the company's current strategy involves maintaining the dividend while managing capital to address liquidity needs rather than aggressively reinvesting for expansion. The overall growth and income profile presents a mixed picture characterized by a contraction in top-line and bottom-line performance alongside a low but sustainable dividend payout and a highly leveraged financial structure.