Here's Why Matador Resources (MTDR) Looks Promising Right Now
Matador Resources Company MTDR has witnessed upward earnings estimate revisions for 2021 and 2022 in the past 30 days. Also, this independent energy company’s stock price has surged 103.6% year to date versus the industry’s rise of 52.9%.
Factors Favoring the Stock
The price of West Texas Intermediate crude, which is trading close to $60 per barrel, has improved drastically from the negative territory touched in April 2020. The momentum is likely to continue since the coronavirus vaccine rollout will possibly help the economy recover strongly this year, thereby aiding fuel demand.
The massive improvement in oil price is definitely a boon for oil explorers and producers and Matador Resources, having a strong footprint in the liquid-rich Delaware Basin’s Wolfcamp and Bone Spring plays, is well placed to capitalize on the same.
Amid an improving commodity pricing scenario, the upstream player’s plan to increase oil production in 2021 will generate additional cashflow. The company, carrying a Zacks Rank #1 (Strong Buy), projects this year’s total oil production in the range of 17.2 to 17.8 million barrel, suggesting a 10% year-over-year improvement.
Moreover, the company’s strong focus on improving capital efficiency continues to aid its bottom line. In 2021, the upstream energy firm projects drilling and completion costs for operated horizontal wells turned to sales to plunge roughly 14% year over year. On top of that, initiating dividend payments is among the key priorities Matador Resources has set for 2021.
Other Stocks to Consider
Other prospective players in the energy space include Chevron Corporation CVX, Diamondback Energy, Inc. FANG and EOG Resources, Inc. EOG. All the stocks sport a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Chevron witnessed upward earnings estimate revisions for 2021 in the past 30 days.
Diamondback is likely to see earnings growth of 112.5% in 2021.
EOG Resources is likely to see earnings growth of 272% in 2021.
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