Matador (MTDR) Tops on Q4 Earnings, Hikes Quarterly Dividend
Matador Resources Company MTDR reported fourth-quarter 2022 adjusted earnings of $2.08 per share, beating the Zacks Consensus Estimate of $1.95 per share. The bottom line significantly improved from the year-ago quarter’s earnings of $1.26 per share.
Total quarterly revenues of $707.5 million surpassed the Zacks Consensus Estimate of $651 million. The top line also increased from the year-ago level of $566.4 million.
Strong quarterly earnings were driven by higher oil-equivalent production volumes and commodity price realizations.
Matador Resources Company Price, Consensus and EPS Surprise
Matador Resources Company price-consensus-eps-surprise-chart | Matador Resources Company Quote
Dividend Hike
Matador’s board of directors announced a quarterly cash dividend of 15 cents per share, indicating a 50% increase from the last paid dividend of 10 cents per share. The dividend is payable on Mar 9, 2023, to shareholders of record as of Feb 27, 2023.
Production
For fourth-quarter 2022, total production volume averaged 10,280 thousand barrels of oil equivalent (MBoe) (comprising 55.8% oil), higher than 8,030 MBoe a year ago.
The average oil production volume was 62,316 barrels per day (Bbls/d), up from 49,756 Bbls/d reported in fourth-quarter 2021. Natural gas production was 296.5 million cubic feet per day (MMcf/d), up from 225.2 MMcf/d a year ago.
Price Realization
The average realized price for oil (excluding realized derivatives) was $83.90 per barrel, which significantly increased from $76.82 in the year-ago quarter. The natural gas price of $5.65 per thousand cubic feet was lower than $7.68 in the prior-year quarter.
Operating Expenses
The company’s plant and other midstream services’ operating expenses increased to $2.85 per Boe from the year-earlier figure of $2.12. Also, lease operating costs increased from $3.34 per Boe in fourth-quarter 2021 to $3.98. Yet, production taxes, transportation and processing costs declined to $6.10 per barrel of oil equivalent (Boe) from $6.48 in the year-ago quarter.
Total operating expenses per Boe were $29.09, higher than the prior-year figure of $26.23.
Balance Sheet
As of Dec 31, 2022, Matador had cash and restricted cash of $547.3 million. Long-term debt was $1,160.2 million. Debt to capitalization was 26%.
Capital Spending
The company spent $188.9 million for the drilling, completing and equipping of wells in the fourth quarter, almost 13% lower than its projection primarily due to the timing of operations.
Outlook
For 2023, Matador increased its oil-equivalent production guidance to 44.35-46.25 million barrels. The metric suggests an improvement from 38.5 million oil-equivalent barrels reported in 2022. The company expects to produce 26.4-27.3 million barrels of oil in 2023.
Matador’s capital spending guidance for drilling, completing and equipping wells is pegged at $1,180-$1,320 million for the year. In midstream, it expects to spend $150-$200 million.
Zacks Rank & Stocks to Consider
Matador currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco LP’s SUN fourth-quarter 2022 earnings of 42 cents per unit missed the Zacks Consensus Estimate of 77 cents. Weak quarterly earnings resulted from the higher total cost of sales and operating expenses.
Sunoco has witnessed upward estimate revisions for 2023 earnings in the past 30 days. For 2023, Sunoco expects adjusted EBITDA of $850-$900 million.
RPC Inc.’s RES adjusted earnings of 41 cents per share in the fourth quarter beat the Zacks Consensus Estimate of 30 cents. The strong quarterly results were backed by higher activity levels in all the service lines and rising equipment utilization.
As of Dec 31, RPC had cash and cash equivalents of $126.4 million, up sequentially from $73.2 million. Nonetheless, the company managed to maintain a debt-free balance sheet.
Murphy USA Inc.’s MUSA fourth-quarter 2022 earnings per share of $5.21 missed the Zacks Consensus Estimate of $6.16. The underperformance can be attributed to lower-than-expected petroleum product sales.
Murphy USA projects a 2023 fuel volume of 240-245 thousand gallons on an APSM basis. Further, Murphy USA’s 2023 guidance includes up to 45 new stores, up to 30 raze-and-rebuilds, and $795-$815 million in merchandise margin contribution.
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