Matador Resources (MTDR) Valuation Update - April 22
Posted: Tue Apr 22, 2025 11:42 am
I have updated my forecast/valuation model for MTDR for my updated oil & gas price deck.
MTDR was trading at $41.58 at the time of this post. < Less than 2.5 X operating CFPS.
I am lowering my current valuation by $5 to $85 share. ~40% of Matador's 2025 oil production is hedged with collars that have $86 ceilings and $60 floors, so the lower oil prices that I am using for 2025 did have an impact on my valuation. BUT my valuation multiple of just 4.25 X annualized operating cash flow per share is a very conservative multiple for a company of this size and quality.
TipRanks: "In the last 3 months, 14 ranked analysts set 12-month price targets for MTDR. The average price target among the analysts is $70.29." The 14 analysts price target range from $90 to $62.
Matador will be announcing Q1 results after the markets close on April 23. If Matador's actual Q1 results beat the First Call Revenues and Earnings per share forecasts, which I now expect them to do, the Wall Street Gang should be giving it a lot of "Strong Buy" recommendations, but we are currently in a world that is controlled by the Panicans.
If WTI oil prices average $75/bbl and HH natural gas prices average $4.50/mcf in 2026, Matador should generate over $3 Billion of operating cash next year ($24/share). If the FEAR of recession fades, this stock should have a shot at $100 within 12-months.
My updated forecast model will be posted to the EPG website this afternoon.
MTDR was trading at $41.58 at the time of this post. < Less than 2.5 X operating CFPS.
I am lowering my current valuation by $5 to $85 share. ~40% of Matador's 2025 oil production is hedged with collars that have $86 ceilings and $60 floors, so the lower oil prices that I am using for 2025 did have an impact on my valuation. BUT my valuation multiple of just 4.25 X annualized operating cash flow per share is a very conservative multiple for a company of this size and quality.
TipRanks: "In the last 3 months, 14 ranked analysts set 12-month price targets for MTDR. The average price target among the analysts is $70.29." The 14 analysts price target range from $90 to $62.
Matador will be announcing Q1 results after the markets close on April 23. If Matador's actual Q1 results beat the First Call Revenues and Earnings per share forecasts, which I now expect them to do, the Wall Street Gang should be giving it a lot of "Strong Buy" recommendations, but we are currently in a world that is controlled by the Panicans.
If WTI oil prices average $75/bbl and HH natural gas prices average $4.50/mcf in 2026, Matador should generate over $3 Billion of operating cash next year ($24/share). If the FEAR of recession fades, this stock should have a shot at $100 within 12-months.
My updated forecast model will be posted to the EPG website this afternoon.