STR is in our High Yield Income Portfolio. Annual dividend yield is ~9.6%. My current valuation is $25/share.
FIRST QUARTER 2025 HIGHLIGHTS
Delivered first quarter 2025 production of 18.9 MBbls/d oil and 42.1 MBoe/d total, exceeding the midpoint of full year Company guidance by 2% and 6%, respectively < Right at my forecast.
Reported first quarter net income of $26.3 million and Adjusted EBITDA of $142.2 million. Financial results reflected strong production volumes from legacy assets and recent acquisitions, as well as expenses in line with or better than the midpoint of our full year guidance ranges < Beat my forecast of $20.7 Net Income.
Operators turned-in-line 11.1 net wells across Sitio's acreage position, up 34% quarter-over-quarter, as the Company's assets continue to attract significant drilling capital
Net line of sight ("LOS") wells totaled 48.6 as of March 31, 2025, up 8% quarter-over-quarter, including 28.9 net spud wells and 19.7 net permitted wells
Increased estimated inventory by 40 net locations, based on 2024 operator drilling activity; represents a 10% quarter-over-quarter increase and equates to a little more than a year of drilling at current average drilling pace
Closed $20.6 million of immediately accretive acquisitions located in the DJ and Midland Basins, adding approximately 1,350 net royalty acres ("NRAs")
Repurchased $22.3 million, or 1.1 million shares, of common stock in the first quarter 2025
Continued to return cash to shareholders and enhance value on a per share basis; first quarter total return of capital of $0.50 per share of Class A Common Stock, comprised of a $0.35 per share declared cash dividend (payable May 30, 2025), and $0.15 per share of stock repurchases
Subsequent to the first quarter, on May 7, 2025, Sitio's Board of Directors extended the Company's share repurchase program with authorization of an additional $300 million, bringing remaining share buyback capacity to approximately $350 million
"With solid momentum exiting the first quarter 2025, our conviction in the quality of our assets and operators has never been stronger," said Sitio CEO Chris Conoscenti. "Consistent with our view of the long term value of our assets compared to our market valuation, our Board has authorized an additional $300 million of share buybacks and we will continue to take advantage of the current dislocation. The recent period of macro volatility highlights the benefits of minerals and royalties as an asset class, and Sitio specifically. With no obligatory capex, no operating costs and LTM Adjusted EBITDA margin(2) of 90%, our cash flow is remarkably resilient. Our well-capitalized operators have historically had some of the most durable and consistent capital programs in the upstream industry. Further, we have no direct tariff exposure and our diversified portfolio of perpetual real assets offers owners an attractive hedge to inflation. We continue to generate significant free cash flow to support our dividend, opportunistic share buybacks, debt paydown and accretive acquisitions. We are well-positioned to continue to consolidate the fragmented minerals market and we will continue to be judicious allocators of our shareholders' capital."
Sitio Royalties (STR) Q1 Results - May 8
Sitio Royalties (STR) Q1 Results - May 8
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group