Matador Resources Company

Matador Resources Company is a U.S. oil and natural gas producer listed on the New York Stock Exchange as MTDR. Its operations center on the Delaware Basin in southeastern New Mexico and West Texas, with additional production in northwestern Louisiana.

Matador also gathers, processes and transports hydrocarbons and handles produced water for its own wells and other producers. It owns 51% of San Mateo Midstream and has other wholly owned midstream assets. Its consolidated financial statements include 100% of San Mateo, with the outside owners' share deducted when reporting earnings attributable to Matador shareholders.

Production and earnings through three quarters

Adjusted earnings exclude unrealized derivative gains and losses and certain nonrecurring items, with related tax adjustments. Realized hedge settlements remain in the measure. The third-quarter 2026 adjustment increased net income attributable to Matador shareholders from $172.1 million to $257.5 million.

Natural gas revenue recovered from negative $38.8 million in the second quarter to $162 million in the third. The average gas price before hedges rose from negative $0.79 to $2.99 per thousand cubic feet; including realized hedges, it rose from $1.24 to $2.81. Energy Transfer's Hugh Brinson pipeline began operating on September 1, giving Matador another route for its gas. Gas production also increased 10% from the preceding quarter.

The acquisitions changing the business

In May 2026, Matador acquired 5,154 net undeveloped acres in a federal lease sale for about $1.16 billion. These acquisition costs are separate from its annual drilling and midstream capital budget.

San Mateo completed its Cardinal Midstream acquisition on July 31 for announced cash consideration of $752 million, subject to adjustments. Funding included a $650 million San Mateo term loan due July 30, 2027, capital contributions of $51 million from Matador and $49 million from its partner Five Point, and cash on hand. Cardinal's operations are included from closing, so San Mateo's subsequent growth includes acquired assets.

Matador completed the Paloma acquisition on October 1 for $1.255 billion in cash, subject to customary post-closing adjustments. On October 8, it announced the closing of the Ridge Runner acquisition, adding about 13,600 net acres, mostly undeveloped. Together with earlier smaller purchases, Ridge Runner brought its Woodford position to about 50,000 net acres. Neither October acquisition contributed to Matador's third-quarter production.

Cash and borrowing before the October deals

At September 30, Matador reported $11.8 million of unrestricted cash and $58.4 million of restricted cash. The same balance sheet listed $951 million of borrowings under its reserves-based credit agreement and $2.368 billion of senior unsecured notes at carrying value. San Mateo separately had $1.002 billion of revolving borrowings and a $647.3 million current term-loan carrying value. Those San Mateo balances are consolidated in full despite Matador's 51% ownership. This snapshot precedes the October acquisitions.

Matador reported $287.6 million of third-quarter adjusted free cash flow attributable to its shareholders. Its calculation adjusts operating cash flow for working capital, ownership interests and other specified items, then deducts capital spending adjusted for accruals; it excludes acquisitions.

The company reported repaying $150 million of its reserves-based borrowings in October. That is progress toward the $350 million to $400 million fourth-quarter repayment plan announced when Paloma closed, which depended on commodity prices.

What the next results will test

Third-quarter production exceeded the August forecast of 222,000 to 226,000 barrels of oil equivalent a day. Matador now forecasts 238,000 to 242,000 a day for the fourth quarter, including about 10,000 from Paloma and Ridge Runner. The August annual outlook had already anticipated fourth-quarter production from those deals.

The full-year production midpoint increased from 221,000 to 223,500 barrels of oil equivalent a day. The drilling, completion and equipment budget midpoint stayed at $1.52 billion, while the midstream midpoint increased from $155 million to $180 million. The combined annual range is now $1.67 billion to $1.73 billion. Part of the fourth-quarter spending will catch up on projects shifted from the third quarter.

In October, Matador raised its quarterly dividend from $0.375 to $0.4375 a share, or $1.75 annualized. The next payment is scheduled for December 4, with a November 10 record date.