Magnolia Oil & Gas Corp (MGY) came out with quarterly earnings of $0.55 per share, beating the Zacks Consensus Estimate of $0.53 per share. This compares to earnings of $0.49 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 3.77%. A quarter ago, it was expected that this company would post earnings of $0.46 per share when it actually produced earnings of $0.49, delivering a surprise of 6.52%.Over the last four quarters, the com ...

Financial Performance - Magnolia reported a net income of $106.6 million for Q1 2025, a 9% increase from $97.6 million in Q1 2024[3] - Adjusted EBITDAX for Q1 2025 was $248.4 million, up 9% from $227.8 million in the same quarter last year[3] - Total revenues for the quarter ended March 31, 2025, increased to $350,300,000 from $319,417,000 in the same quarter of 2024, representing a growth of 9.2%[23] - Net income for the quarter ended March 31, 2025, was $106,648,000, compared to $97,597,000 for the same period in 2024, representing an increase of 9.4%[35] - Adjusted net income for the quarter ended March 31, 2025, was $105,570,000, up from $101,007,000 in 2024, reflecting a growth of 4.6%[35] Production and Operations - Average daily production increased by 14% year-over-year to 96.5 Mboe/d, including 39.1 Mbbls/d of oil[4] - Giddings production volumes grew by 25% year-over-year, contributing 79% of total company production in Q1 2025[9] - Oil production increased to 3,517 MBbls in Q1 2025 from 3,415 MBbls in Q1 2024, a rise of 3.0%[21] - Natural gas production rose significantly to 16,492 MMcf in Q1 2025, compared to 13,749 MMcf in Q1 2024, marking an increase of 19.9%[21] - Average daily production of total oil equivalent (boe/d) increased to 96,549 in Q1 2025 from 84,784 in Q1 2024, reflecting a growth of 13.5%[21] Cash Flow and Shareholder Returns - The company generated free cash flow of $110.5 million, returning $81.7 million, or 74% of free cash flow, to shareholders through share repurchases and dividends[5] - Free cash flow for the quarter ended March 31, 2025, was $110,524,000, down from $117,131,000 in Q1 2024, a decrease of 5.7%[42] - The company repurchased 2.2 million shares of Class A Common Stock for $52.0 million during the first quarter[4] - The company repurchased Class A common stock amounting to $52,393,000 during Q1 2025, compared to $51,201,000 in Q1 2024[25] Guidance and Capital Expenditures - Full-year 2025 production growth guidance has been raised to 7-9%, up from the previous 5-7%[4] - Capital expenditures for 2025 have been reduced to a range of $430 to $470 million, a decrease of over 5% from the initial plan[4] - Magnolia plans to maintain two drilling rigs and one completion crew throughout 2025, focusing on multi-well development pads in the Giddings area[11] Costs and Expenses - Operating expenses totaled $214,478,000 in Q1 2025, up from $194,859,000 in Q1 2024, an increase of 10.0%[23] - The average sales price of oil per barrel decreased to $69.81 in Q1 2025 from $75.89 in Q1 2024, a decline of 8.7%[23] - Revenue per barrel of oil equivalent (boe) decreased to $40.31 in Q1 2025 from $41.40 in Q1 2024, a decline of 2.6%[39] - Total adjusted cash operating costs per boe were $11.74 for Q1 2025, slightly down from $11.86 in Q1 2024, indicating a reduction of 1.0%[39] - Adjusted cash operating margin per boe was $28.57 in Q1 2025, compared to $29.54 in Q1 2024, resulting in a margin percentage of 71% for both periods[39] Balance Sheet and Liquidity - The company ended Q1 2025 with a cash balance of $247.6 million and an undrawn $450 million revolving credit facility[5] - Cash and cash equivalents at the end of Q1 2025 were $247,558,000, down from $399,317,000 at the end of Q1 2024[25] Tax and Effective Rate - The effective tax rate for the quarters ended March 31, 2025, and 2024, was 20.3% and 18.9%, respectively, indicating an increase in the tax burden[35] Strategic Focus - The company continues to focus on maintaining profitability and cash flow generation while managing operating costs effectively[38]

Group 1 - Magnolia Oil & Gas (NYSE: MGY) is not considered a cheap entry in the oil and gas industry, indicating a premium valuation due to good management and execution [2] - The oil and gas industry is characterized as a boom-bust, cyclical sector, requiring patience and experience for successful investment [2] Group 2 - The analysis of oil and gas companies includes a breakdown of balance sheets, competitive positions, and development prospects to identify undervalued opportunities [1]

J.P. Morgan analyst Zach Parham shared his view on Magnolia Oil & Gas Corporation MGY ahead of the earnings release on May 1st.The analyst maintained a Neutral rating on the stock with a price forecast of $24 after updating for first-quarter commodity prices.Parham writes that Magnolia Oil & Gas remains on track with its 2-rig/1-frac crew program and is committed to keeping capex below 55% of EBITDA.Despite commodity price volatility, the analyst expects capital expenditure to stay under 50% of EBITDA due t ...

Core Viewpoint - Magnolia Oil & Gas Corp (MGY) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Revisions - The Zacks Consensus Estimate for Magnolia Oil & Gas Corp for the fiscal year ending December 2025 is projected at $2.18 per share, reflecting a 2.4% increase from the previous year's reported figure [8]. - Over the past three months, analysts have raised their earnings estimates for the company by 8.5%, indicating a strong upward trend in earnings outlook [8]. Zacks Rating System - The Zacks Rank system classifies stocks based on earnings estimate revisions, with only the top 20% of stocks receiving a 'Strong Buy' or 'Buy' rating, suggesting a higher likelihood of market-beating returns [9][10]. - The Zacks Rank 2 upgrade places Magnolia Oil & Gas Corp in the top 20% of Zacks-covered stocks, indicating its strong earnings estimate revision feature [10]. Market Implications - The upgrade reflects an improvement in the company's underlying business, which is expected to lead to increased buying pressure and a potential rise in stock price [5][6]. - The correlation between earnings estimate revisions and near-term stock movements suggests that tracking these revisions can be beneficial for investment decisions [6][4].

A month has gone by since the last earnings report for Magnolia Oil & Gas Corp (MGY) . Shares have added about 3.1% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Magnolia Oil & Gas Corp due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.How Have Estimates Been Moving ...

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Core Insights - Zacks Premium provides tools for investors to enhance their stock market engagement and confidence, including daily updates, research reports, and stock screens [1][2] Zacks Style Scores - Zacks Style Scores rate stocks based on value, growth, and momentum, serving as complementary indicators to the Zacks Rank, helping investors identify securities likely to outperform the market in the short term [2][3] Value Score - The Value Style Score identifies attractive and discounted stocks using various financial ratios such as P/E, PEG, and Price/Sales, appealing to value investors [3] Growth Score - The Growth Style Score focuses on a company's future prospects and financial health, analyzing projected and historical earnings, sales, and cash flow to find stocks with sustainable growth [4] Momentum Score - The Momentum Style Score helps investors capitalize on price trends by analyzing short-term price changes and earnings estimate revisions, indicating favorable buying opportunities [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors who utilize multiple investing strategies, highlighting stocks with strong value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model based on earnings estimate revisions, with a historical average annual return of +25.41% for 1 (Strong Buy) stocks since 1988, significantly outperforming the S&P 500 [7][8] Stock to Watch: Magnolia Oil & Gas Corp - Magnolia Oil & Gas is an independent operator focused on natural gas and crude oil production, primarily in the Eagle Ford Shale and Austin Chalk formations in South Texas [12] - The company holds a 3 (Hold) Zacks Rank with a VGM Score of B and a Value Style Score of B, supported by a forward P/E ratio of 10.39, making it attractive to value investors [12][13] - Recent upward revisions in earnings estimates by analysts and a Zacks Consensus Estimate increase to $2.18 per share, along with an average earnings surprise of 9%, position MGY favorably for investors [13]

Core Insights - Magnolia Oil & Gas Corporation (MGY) reported a fourth-quarter 2024 net profit of 49 cents per share, exceeding the Zacks Consensus Estimate of 46 cents, driven by increased production volumes despite a decrease from the previous year's profit of 50 cents due to rising operating expenses [1][2] Financial Performance - Total revenues for the quarter were $326.6 million, slightly above the Zacks Consensus Estimate of $326 million, marking a 1.2% increase from $322.6 million in the same quarter last year, attributed to higher revenues from natural gas liquids [2] - The company generated $222.6 million in net cash from operating activities and achieved a free cash flow of $90.3 million [3] - Operating expenses rose to $202.5 million from $184.5 million year over year [11] Dividend and Share Repurchase - Magnolia declared a cash dividend of 15 cents per share for Class A Common stock and Class B units, reflecting a 15.4% increase, resulting in an annualized dividend rate of 60 cents per share, marking the fourth consecutive year of dividend increases since 2021 [4] - In the fourth quarter, the company repurchased 2.2 million Class A Common shares for $55.8 million, totaling 11 million shares repurchased for the full year, leading to a 5% reduction in diluted weighted average share count [5][6] Production and Prices - Average daily total output was 93,096 barrels of oil equivalent per day (boe/d), up from 85,414 boe/d in the year-ago quarter, with oil and gas production increasing by 9% year over year [7] - Oil volumes reached 38,821 barrels per day (bpd), a 9.5% increase from the previous year, while natural gas volumes were 167,079 thousand cubic feet per day (Mcf/d), up 7.9% but below expectations [8] - The average realized crude oil price was $69.01 per barrel, down 12.1% from $77.39 a year ago, and the average sales price of $38.13 per boe compared to $41.06 a year prior [9] Balance Sheet and Capital Expenditure - As of December 31, Magnolia had cash and cash equivalents of $260 million and long-term debt of $392.5 million, with a total debt-to-total capital ratio of 16.6% [10] - The company spent $131.6 million on its capital program in the reported quarter [11] Guidance - For 2025, Magnolia expects drilling and completion capital spending to be between $460 million and $490 million, with production growth anticipated at 5-7% [12][13] - The first quarter of 2025 is projected to have D&C capital spending of around $135 million and total production of approximately 94 thousand boe/d [13]

Reserves and Production - As of December 31, 2024, Magnolia's total proved reserves amounted to 191.7 million barrels of oil equivalent (MMboe), consisting of 77.2 million barrels of oil, 336.8 billion cubic feet (Bcf) of natural gas, and 58.3 million barrels (MMBbls) of natural gas liquids (NGLs) [77] - Magnolia's proved undeveloped reserves increased by 7.8 MMboe during the year ended December 31, 2024, totaling 42.4 MMboe, which includes 14.2 MMBbls of oil, 78.4 Bcf of natural gas, and 15.1 MMBbls of NGLs [79] - The company converted 28.8 MMboe of proved undeveloped reserves to proved developed reserves as a result of drilling activities completed during 2024 [79] - Magnolia operated two rigs during 2024, achieving total production of 89.7 thousand barrels of oil equivalent per day (Mboe/d) [64] - Approximately 43% of Magnolia's production was attributable to oil, 30% to natural gas, and 27% to NGLs for the year ended December 31, 2024 [64] - The company reported crude oil production of 14.0 million barrels in 2024, up from 12.6 million barrels in 2023, and natural gas production of 58.7 billion cubic feet, an increase from 55.1 billion cubic feet in 2023 [86] - Magnolia's total production for the year ended December 31, 2024, was 89.7 Mboe/d, with approximately 43% from oil, 30% from natural gas, and 27% from NGLs [64] - Crude oil production increased to 14.0 MMBbls in 2024, up from 12.6 MMBbls in 2023, representing an 11.1% growth [86] - Natural gas production rose to 58.7 Bcf in 2024, compared to 55.1 Bcf in 2023, marking a 6.5% increase [86] Financial Performance and Strategy - The company incurred costs of approximately $271.6 million to convert reserves associated with 38 net proved undeveloped locations to 28.8 MMboe of proved developed reserves [80] - Magnolia's business model emphasizes prudent capital allocation, aiming to spend within cash flow while maintaining low financial leverage [60] - The company targets moderate annual organic production growth and aims to generate significant free cash flow after capital expenditures [62] - Magnolia's long-term strategy focuses on generating moderate annual organic production growth and maintaining a conservative financial leverage profile [62] - The company plans to effectively reinvest free cash flow to maximize shareholder returns while maintaining an efficient capital program [62] Operational Activities - In 2024, Magnolia operated two rigs and drilled a total of 53 net productive development wells, an increase from 45 in 2023 and 50 in 2022, representing a 17.8% increase year-over-year [83] - As of December 31, 2024, Magnolia had 63 gross (23 net) development wells in the process of being drilled, completed, or awaiting completion operations [81] - Magnolia's assets cover a total leasehold position of 817,907 gross acres, with significant holdings in the Karnes and Giddings areas of South Texas [64] - The company has demonstrated strong economic viability in its drilling activities, particularly in the Giddings area, due to recent improvements in drilling and completion technologies [65] Regulatory and Environmental Compliance - Magnolia is subject to new federal regulations aimed at reducing methane emissions, which may impact operational costs and compliance requirements [100] - The company plans to invest in additional direct measurement technologies to improve the accuracy of methane emissions reporting, aligning with new EPA guidelines [100] - The company faces increased regulatory scrutiny regarding methane emissions and may incur costs to comply with new federal regulations [100] Employee and Community Engagement - In 2024, Magnolia contributed $252,000 towards employee-directed donations to local and national non-profits, supporting various causes [124] - Magnolia's field teams set a program record by contributing more than $43,500 to over 30 local non-profit organizations in 2024 [125] - As of December 31, 2024, 23% of Magnolia's total employee population was female, and 29% identified as members of a minority group [119] - Magnolia's employees received an average of approximately 60 hours of safety training in 2024, focusing on enhancing their skills [122] - The Company was recognized as a top workplace in the annual Houston Chronicle Top Workplaces survey, placing tenth among mid-sized companies in the greater Houston area [116] - Magnolia's commitment to safety includes tracking key safety metrics and implementing proactive measures to minimize health and safety risks [120] - The Company continues to offer a workplace flexibility program, allowing eligible employees to telecommute for up to two days a week [115] - Magnolia's Human Capital Philosophy emphasizes attracting and retaining qualified individuals to enhance its position as an employer of choice [113] Safety and Governance - Magnolia's Environmental, Social, and Governance (ESG) policies are overseen by the Nominating and Corporate Governance Committee, focusing on safety, social responsibility, and human capital issues [113] - The company tracks key safety metrics, including total recordable incident rate and contractor recordables, to ensure employee safety [120] - The company maintains comprehensive emergency response and crisis communication plans at both field and corporate levels [123] - Magnolia's Think Like a Magnolia Owner CEO Award program continued in 2024 to recognize projects that generated shareholder value [115]