NYSE:MTDR
Matador Resources Co
Matador Resources Co is a leading independent E&P firm maximizing value from its high-quality unconventional resource base in the Permian Basin and Midcontinent regions.
Key Metrics
Investment Thesis
Bull Case
Matador offers compelling value for investors seeking exposure to high-quality unconventional oil and gas assets with low breakeven costs that provide resilience during commodity downturns. The company's strong free cash flow generation supports a consistent capital return program, including dividends and buybacks, which enhances shareholder yield in an inflationary environment. Positioned in the most prolific drilling regions in North America, Matador is well-placed to capitalize on long-term demand growth for energy while benefiting from potential M&A opportunities as peers deleverage.
Bear Case
Despite strong cash flow, the company's net income declined year-over-year in 2025, indicating vulnerability to margin compression or volume setbacks that could persist if oil prices remain volatile. Significant capital expenditures of $2.16B and substantial revolver activity suggest ongoing liquidity pressure, which may limit flexibility for strategic acquisitions or aggressive growth initiatives in a high-rate environment. As an energy sector stock, Matador remains exposed to geopolitical shocks and regulatory headwinds that could disproportionately impact smaller-cap independents compared to major integrated oil companies.
About Matador Resources Co
Matador Resources Co is an independent energy exploration and production company focused on producing crude oil and natural gas from unconventional plays across the United States. The company serves major global energy markets by delivering reliable hydrocarbon supplies through its core acreage in Texas, New Mexico, and Oklahoma. Key revenue streams are generated primarily from crude oil sales, with significant contributions from natural gas and associated NGLs.
Analysis
Management Discussion
In 2025, the company reported revenue of $3.70B and net income of $860.8M, reflecting a slight moderation from the previous year's $971.3M despite a revenue increase driven by higher oil prices in the latter half of the fiscal period. Operating cash flow remained robust at $2.43B, enabling significant capital returns through $55.8M in share repurchases and dividends, though net debt increased due to revolver activity totaling $2.17B in proceeds versus $2.37B in repayments. The company successfully navigated a challenging macro environment by maintaining operational efficiency, though the dip in net income from 2024 suggests sensitivity to margin compression or volume declines.
Industry Overview
The global oil and gas industry is currently navigating a transition period characterized by shifting geopolitics, the push for renewable energy adoption, and continued demand for hydrocarbons in emerging markets. Independent producers like Matador are essential for maintaining supply security and price stability as major oil majors retreat from exploration activities in unconventional plays. Technological advancements in hydraulic fracturing and horizontal drilling continue to drive productivity gains, allowing smaller operators to compete effectively with large-scale projects.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $3.06B | $2.81B | $3.50B | $3.70B |
| Cost of Revenue | $95.5M | $128.9M | $171.5M | $208.1M |
| Gross Profit | $2.96B | $2.68B | $3.33B | $3.49B |
| Operating Expenses | $1.20B | $1.47B | $513.0M | $624.0M |
| Operating Income | $1.76B | $1.21B | $1.43B | $1.23B |
| G&A | $116.2M | $110.4M | $127.5M | $137.1M |
| Stock-Based Comp | $15.1M | $13.7M | $15.0M | $18.3M |
| D&A | $466.3M | $716.7M | $974.3M | $1.20B |
| Other OpEx | $1.09B | $1.36B | $385.6M | $486.9M |
| Non-Operating Income | $-73.6M | $-112.9M | $-171.0M | $-193.1M |
| Interest Expense | $67.2M | $121.5M | — | — |
| Pre-Tax Income | $1.69B | $1.10B | $1.26B | $1.03B |
| Income Tax | $399.4M | $186.0M | $292.4M | $172.7M |
| Continuing Ops | $1.29B | $910.4M | $971.3M | $860.8M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $1.29B | $910.4M | $971.3M | $860.8M |
| Minority Interest | $72.1M | $64.3M | $86.0M | $101.5M |
| Net to Common | $1.21B | $846.1M | $885.3M | $759.2M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $1.07B | $715.9M | $927.3M | $816.6M |
| Cash & Equivalents | $505.2M | $52.7M | $23.0M | $15.3M |
| Accounts Receivable | $224.9M | $274.2M | $331.6M | $286.2M |
| Prepaid Expenses | $51.6M | $92.7M | $123.4M | $129.4M |
| Other Current Assets | $290.2M | $296.3M | $449.3M | $385.7M |
| Long-Term Assets | $4.48B | $7.01B | $9.92B | $10.89B |
| PP&E (Net) | $4.42B | $6.96B | — | — |
| Operating Leases | $58.8M | $44.4M | $127.4M | $138.7M |
| Other LT Assets | $5.7M | $10.3M | $9.80B | $10.76B |
| Total Assets | $5.55B | $7.73B | $10.85B | $11.71B |
| Current Liabilities | $575.9M | $685.3M | $995.4M | $1.03B |
| Accounts Payable | $58.8M | $68.2M | $147.1M | — |
| Current Leases | $43.9M | $36.9M | $57.9M | $65.1M |
| Other Current Liab | $211.8M | $214.3M | $348.8M | $966.4M |
| Long-Term Liabilities | $1.66B | $2.91B | $4.40B | $4.68B |
| LT Operating Leases | $19.5M | $10.8M | $72.5M | $79.2M |
| Other LT Liab | $1.64B | $2.90B | $4.32B | $4.60B |
| Total Liabilities | $2.24B | $3.60B | $5.39B | $5.71B |
| Shareholders' Equity | $3.32B | $4.13B | $5.46B | $6.00B |
| Paid-In Capital | $2.10B | $2.13B | $2.53B | $2.51B |
| Retained Earnings | $1.01B | $1.78B | $2.56B | $3.15B |
| Treasury Stock | $34.0K | $45.0K | $2.3M | $5.3M |
| Total L&E | $5.55B | $7.73B | $10.85B | $11.71B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $1.29B | $910.4M | $971.3M | $860.8M |
| Non-Cash Adjustments | $385.4M | $969.6M | $1.05B | $1.56B |
| Working Capital Changes | $307.0M | $-12.1M | $228.8M | $2.1M |
| Cash from Operations | $1.98B | $1.87B | $2.25B | $2.43B |
| Cash from Investing | $-1.04B | $-3.21B | $-3.67B | $-2.16B |
| Share Buybacks | — | — | — | $55.8M |
| Dividends Paid | $35.2M | $77.2M | $104.9M | $163.1M |
| Cash from Financing | $-480.9M | $902.3M | $1.41B | $-282.6M |
| FX Effect | $0 | $0 | $0 | $0 |
| Net Change in Cash | $460.4M | $-441.0M | $-11.6M | $-15.3M |
| Beginning Cash | $86.9M | $547.3M | $106.3M | $94.7M |
| Ending Cash | $547.3M | $106.3M | $94.7M | $79.5M |
Frequently Asked Questions
How does Matador Resources Co make money?
Crude Oil Production: The primary revenue driver representing approximately 90% of total sales volume, focused on heavy oil and condensate plays. Natural Gas & NGLs: A secondary but growing segment providing diversification and hedging opportunities against crude price volatility. Exploration & Development: Capital allocation activities targeting acreage expansion in high-return basins including the Eagle Ford and Delaware Basin.
What are the main risks for MTDR?
Commodity Price Volatility: Profitability is heavily dependent on fluctuating global crude oil and natural gas prices which can significantly impact revenue and earnings per share. Regulatory and Environmental Pressures: The company faces ongoing risks from evolving environmental regulations, climate change policies, and potential community opposition to drilling activities in key states. Capital Intensity and Leverage: As an exploration and production company, Matador requires substantial capital for drilling programs; high debt levels or reduced access to credit markets could constrain growth. Operational Safety Incidents: Any significant accidents or unplanned downtime at active rigs could lead to costly liabilities, reputational damage, and production shortfalls.
What is MTDR's competitive advantage?
High-Quality Resource Portfolio: Matador holds one of the largest net acreage positions in the core Permian and Midcontinent regions with low breakeven costs compared to industry peers. Operational Efficiency: Advanced drilling technologies and optimized completion strategies allow the company to achieve superior productivity per well while maintaining a lean cost structure. Financial Discipline: A strong track record of capital allocation, including consistent share buybacks and prudent debt management relative to free cash flow generation.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.