Group 1 - Permian Resources (NYSE: PR) reported strong quarterly results, outperforming other mid-cap U.S. energy companies [1] - Production levels are increasing, and synergies from acquisitions are yielding faster-than-expected results [1] - Free cash flow reached a record high, indicating robust financial health [1] Group 2 - The company's acquisition strategy is proving effective, with improvements in efficiency metrics [1] - The focus on equity markets, particularly growth and small-cap stocks, is emphasized as part of the investment approach [1]

Core Viewpoint - Permian Resources has experienced a slight increase in share price of approximately 0.8% over the past month, underperforming the S&P 500, raising questions about the sustainability of this trend leading up to the next earnings report [1] Group 1: Earnings Estimates - Estimates for Permian Resources have trended downward over the past month, with the consensus estimate shifting down by 17.82% [2] - The overall outlook indicates a downward shift in estimates, with Permian Resources holding a Zacks Rank of 3 (Hold), suggesting an expectation of in-line returns in the coming months [4] Group 2: VGM Scores - Permian Resources has a Growth Score of B, but is lagging in Momentum Score with an F, while also receiving a B grade on the value side, placing it in the second quintile for this investment strategy [3] - The aggregate VGM Score for Permian Resources stands at B, which is relevant for investors not focused on a single strategy [3] Group 3: Industry Performance - Permian Resources is part of the Zacks Oil and Gas - Exploration and Production - United States industry, where Comstock Resources has shown a gain of 7.4% over the past month [5] - Comstock reported revenues of $512.85 million for the last quarter, reflecting a year-over-year increase of 52.7%, with an EPS of $0.18 compared to -$0.03 a year ago [6] - Comstock is projected to post earnings of $0.16 per share for the current quarter, indicating a year-over-year change of 180%, with the Zacks Consensus Estimate remaining unchanged over the last 30 days [6]

Group 1 - Permian Resources Corporation (NYSE: PR) has recovered much of its early April losses, indicating a positive trend for the stock [1] - The stock is viewed as a solid buy, with technical indicators suggesting a net bullish outlook [1] Group 2 - The analysis emphasizes the importance of technical analysis in evaluating stock performance [1] - The author expresses a commitment to high-quality, in-depth analysis for the investment community [1]

Group 1 - Permian Resources Corporation (NYSE: PR) has made a $608 million acquisition aimed at increasing its production by several percent in the future [2] - With WTI oil priced at $70 and Waha natural gas at $2.00, Permian Resources is projected to generate close to $2 billion [2] - The article highlights the analytical expertise of Aaron Chow, who has over 15 years of experience and previously co-founded a mobile gaming company [2]

Core Viewpoint - Permian Resources Corporation (PR) reported a first-quarter 2025 adjusted net income per share of 42 cents, missing the Zacks Consensus Estimate of 44 cents, primarily due to increased operating expenses and lower oil prices, although the figure was consistent with the previous year [1] Financial Performance - Oil and gas sales reached $1.4 billion, reflecting a 10.7% increase year-over-year but falling short of the Zacks Consensus Estimate by 1.2% [1] - Adjusted cash flow from operations increased by 13.9% to $960.5 million, with capital expenditures totaling $501 million, resulting in adjusted free cash flow of $460 million [6] - Total operating expenses rose to $872 million from $774.1 million in the prior year, driven by a 6.5% increase in lease operating costs and a 15.6% rise in depreciation, depletion, and amortization [5] Production and Pricing - Average daily production increased by 16.8% year-over-year to 373,209 barrels of oil equivalent (Boe), surpassing the Zacks Consensus Estimate of 368,855 Boe [3] - Oil volume for the quarter was 174,967 barrels per day, up 15.3% year-over-year, exceeding the consensus mark of 171,776 Bbls/d [3] - The average sales price for oil was $70.48 per barrel, down 7.4% from the previous year, and slightly below the consensus estimate [4] Dividend and Shareholder Returns - The board declared a quarterly cash dividend of 15 cents per share, equivalent to 60 cents annually, to be paid on June 30, 2025 [2] Strategic Moves - The company completed the sale of its non-core Barilla Draw gathering systems for $180 million during the quarter [2] - A strategic acquisition was announced, expected to contribute approximately 12,000 Boe/d in the second half of the year, although this is not included in the revised standalone guidance [10] Guidance and Outlook - Updated full-year 2025 guidance anticipates average daily production between 360,000-380,000 Boe/d, with oil production ranging from 170,000 Bbls/d to 175,000 Bbls/d [7] - Controllable cash expenses are projected to be between $7.25 and $8.25 per Boe, with lease operating expenses estimated at approximately $5.55 per Boe [8] - The capital expenditure budget has been slightly reduced to a range of $1.9-$2 billion [9]

[Part I—FINANCIAL INFORMATION](index=8&type=section&id=Part%20I%E2%80%94FINANCIAL%20INFORMATION) [Financial Statements (Unaudited)](index=8&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) For the first quarter of 2025, Permian Resources reported a significant increase in net income to $390.6 million, up from $229.6 million in the prior-year period, driven by higher production volumes and stronger natural gas and NGL prices Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $1,356,833 | $1,121,594 | | **Total Property and Equipment, net** | $15,358,996 | $15,473,478 | | **TOTAL ASSETS** | **$17,076,443** | **$16,897,900** | | **Total Current Liabilities** | $1,585,272 | $1,327,337 | | **Total Long-term Debt, net** | $3,710,381 | $4,184,233 | | **TOTAL LIABILITIES** | **$6,272,643** | **$6,379,381** | | **Total Equity** | $10,803,800 | $10,518,519 | Consolidated Statement of Operations Highlights (in thousands) | Account | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | **Oil and gas sales** | $1,376,451 | $1,242,999 | | **Total operating expenses** | $871,988 | $774,075 | | **Income from operations** | $504,463 | $469,036 | | **Net income** | **$390,563** | **$229,595** | | **Net income attributable to Class A Common Stock** | $329,298 | $146,575 | | **Diluted EPS** | **$0.44** | **$0.25** | Consolidated Statement of Cash Flows Highlights (in thousands) | Account | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $898,032 | $647,598 | | **Net cash used in investing activities** | ($361,816) | ($619,348) | | **Net cash used in financing activities** | ($313,323) | ($88,835) | | **Net increase (decrease) in cash** | $222,893 | ($60,585) | [Note 2—Acquisitions](index=16&type=section&id=Note%202%E2%80%94Acquisitions) The company completed a bolt-on acquisition from Occidental Petroleum in September 2024, adding approximately 29,500 net leasehold acres - Completed the acquisition of oil and gas properties from Occidental Petroleum affiliates on September 17, 2024, which included approximately **29,500 net leasehold acres** and **9,900 net royalty acres**[63](index=63&type=chunk) - In May 2025, the company agreed to acquire oil and gas properties from Apache Corporation for approximately **$608 million**, adding **13,320 net leasehold acres** and **8,700 net royalty acres** in its New Mexico operating area[157](index=157&type=chunk) [Note 4—Long-Term Debt](index=16&type=section&id=Note%204%E2%80%94Long-Term%20Debt) As of March 31, 2025, total net debt was approximately $4.0 billion, a decrease from $4.2 billion at year-end 2024 Long-Term Debt Composition (in thousands) | Debt Instrument | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Credit Facility | $0 | $0 | | Senior Notes, net | $3,998,984 | $4,184,233 | | **Total debt, net** | **$3,998,984** | **$4,184,233** | - As of March 31, 2025, the company had a borrowing base of **$4.0 billion** with elected commitments of **$2.5 billion** under its credit facility, with no borrowings outstanding and **$2.5 billion** in available capacity[69](index=69&type=chunk) - In January 2025, the company redeemed **$175 million** of its **9.875% Senior Notes** due 2031, paying **$192.3 million** and recognizing a **$5.8 million loss** on debt extinguishment[89](index=89&type=chunk) [Note 6—Stock-Based Compensation](index=19&type=section&id=Note%206%E2%80%94Stock-Based%20Compensation) Stock-based compensation expense increased to $16.9 million in Q1 2025 from $9.6 million in Q1 2024 Stock-Based Compensation Expense (in thousands) | Award Type | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Restricted stock | $6,214 | $4,586 | | Performance stock units | $10,715 | $5,045 | | **Total** | **$16,929** | **$9,631** | [Note 7—Derivative Instruments](index=21&type=section&id=Note%207%E2%80%94Derivative%20Instruments) The company uses derivative instruments to manage commodity price risk, reporting a net gain of $57.7 million in Q1 2025, a reversal from a $121.1 million loss in Q1 2024 Net Gain (Loss) on Derivative Instruments (in thousands) | Type | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Realized cash settlement gains (losses) | $21,308 | $7,345 | | Non-cash mark-to-market derivative gain (loss) | $36,423 | ($128,474) | | **Total** | **$57,731** | **($121,129)** | - As of March 31, 2025, the company has crude oil swaps for **45,000 Bbls/d** for the remainder of 2025 and **17,500 Bbls/d** for 2026, along with significant natural gas swaps extending into 2027[107](index=107&type=chunk)[109](index=109&type=chunk) [Note 9—Shareholders' Equity and Noncontrolling Interest](index=26&type=section&id=Note%209%E2%80%94Shareholders%27%20Equity%20and%20Noncontrolling%20Interest) In Q1 2025, the company declared and paid a total dividend of $0.15 per share, amounting to $121.0 million, with no share repurchases in the quarter Dividends and Distributions Declared and Paid | Period | Base Dividend/Distribution | Variable Dividend/Distribution | Total per Share | Total Paid (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Q1 2025 | $0.15 | $0.00 | $0.15 | $121,010 | | Q1 2024 | $0.05 | $0.10 | $0.15 | $115,521 | - The Board authorized a stock repurchase program of up to **$1 billion**, with no shares repurchased in Q1 2025, but **2.0 million Common Units** for **$31.5 million** in Q1 2024[136](index=136&type=chunk)[137](index=137&type=chunk) [Note 10—Earnings Per Share](index=27&type=section&id=Note%2010%E2%80%94Earnings%20Per%20Share) Basic EPS for Class A Common Stock increased to $0.47 in Q1 2025 from $0.27 in Q1 2024, reflecting significant net income growth Earnings Per Share (EPS) Calculation | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Basic EPS | $0.47 | $0.27 | | Diluted EPS | $0.44 | $0.25 | [Note 13—Subsequent Events](index=29&type=section&id=Note%2013%E2%80%94Subsequent%20Events) Subsequent to quarter-end, the company repurchased shares, reaffirmed its credit facility, declared a dividend, and agreed to a $608 million acquisition - In April 2025, **4.1 million shares** of Class A Common Stock for **$43.3 million** were repurchased[154](index=154&type=chunk) - On April 30, 2025, the company's credit agreement borrowing base was reaffirmed at **$4.0 billion** with elected commitments of **$2.5 billion**[155](index=155&type=chunk) - In May 2025, an agreement was entered to acquire oil and gas properties from Apache Corporation for **$608 million**, expected to close in Q2 2025[157](index=157&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 11% year-over-year revenue growth in Q1 2025 to a 16% increase in total production volumes, offsetting a 7% decline in realized oil prices - The company expects total drilling, completion, and facilities capital expenditures for 2025 to be between **$1.9 billion** and **$2.0 billion**, funded entirely from cash flows from operations[186](index=186&type=chunk) - The company plans to return capital to shareholders through a base dividend and opportunistic share repurchases, paying a quarterly base dividend of **$0.15 per share** in Q1 2025, totaling **$121.0 million**[188](index=188&type=chunk) Production and Revenue Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Production (MBoe) | 33,589 | 29,076 | 16% | | Average Daily Production (Boe/d) | 373,209 | 319,514 | 17% | | Oil Sales Revenue (in thousands) | $1,109,771 | $1,051,642 | 6% | | Average Oil Price ($/Bbl) | $70.48 | $76.13 | (7)% | | Natural Gas Sales Revenue (in thousands) | $81,658 | $38,767 | 111% | | Average Gas Price ($/Mcf) | $1.35 | $0.75 | 80% | Operating Cost Metrics (per Boe) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Lease operating expenses (per Boe) | $5.35 | $5.80 | (8)% | | Gathering, processing & transportation (per Boe) | $1.39 | $1.34 | 4% | | Cash G&A (per Boe) | $0.80 | $0.97 | (18)% | [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is commodity price volatility, mitigated by derivative contracts, with minimal interest rate risk due to fixed-rate debt - A **10% change** in commodity prices would impact quarterly sales by **$111.0 million** for oil, **$8.2 million** for natural gas, and **$18.5 million** for NGLs[205](index=205&type=chunk) - As of March 31, 2025, a hypothetical **10% shift** in the NYMEX forward curve would change the fair value of crude oil hedges by **$129.9 million** and natural gas hedges by **$31.8 million**[206](index=206&type=chunk)[213](index=213&type=chunk) - Interest rate risk is minimal as the **$4.0 billion** in senior notes are fixed-rate, and there were no borrowings under the variable-rate credit facility as of March 31, 2025[214](index=214&type=chunk)[215](index=215&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The principal executive officers and principal financial officer concluded that the company's disclosure controls and procedures were **effective** as of March 31, 2025[217](index=217&type=chunk) - No changes in the system of internal control over financial reporting occurred during Q1 2025 that have materially affected, or are reasonably likely to materially affect, the company's internal control[218](index=218&type=chunk) [Part II—OTHER INFORMATION](index=43&type=section&id=Part%20II%E2%80%94OTHER%20INFORMATION) [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to ordinary course legal proceedings, including a potential environmental liability from the Earthstone Merger, not expected to have a material adverse effect - The company assumed a liability from the Earthstone Merger related to potential environmental defects from a prior Novo acquisition, with potential penalties exceeding **$1 million**, but no material adverse effect is expected[222](index=222&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes in the company's risk factors from those described in its 2024 Annual Report on Form 10-K and other SEC filings - There have been **no material changes** in risk factors from those described in the 2024 Annual Report[224](index=224&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2025, the company did not purchase any of its Common Stock in the open market under its stock repurchase program - No purchases of the company's equity securities were made by the issuer during the three months ended March 31, 2025[225](index=225&type=chunk) [Other Information](index=44&type=section&id=Item%205.%20Other%20Information) During the quarter ended March 31, 2025, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarter[226](index=226&type=chunk) [Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications by the CEO and CFO, and XBRL data files

Financial Data and Key Metrics Changes - The company achieved the highest free cash flow per share in its history at $0.54, driven by lower per unit costs and solid production performance [5][6] - Adjusted operating cash flow reached $900 million, and adjusted free cash flow was $460 million, with cash capital expenditures of $500 million [7] - Cash on the balance sheet increased from $479 million at year-end to approximately $700 million by March 31, and leverage decreased from 1x to 0.8x [7][8] Business Line Data and Key Metrics Changes - Oil production was 175,000 barrels per day, and total production was 373,000 barrels of oil equivalent per day, exceeding expectations [6] - Controllable cash costs were reduced by 4%, and drilling and completion costs decreased by 3%, landing at $750 per foot for the quarter [7] Market Data and Key Metrics Changes - Approximately 25% of 2025 oil production is hedged at a price just above $73 per barrel, allowing the company to be more opportunistic during downturns [9][10] Company Strategy and Development Direction - The company is focused on opportunistic investments during downturns, aiming to acquire high-quality assets with low breakeven costs [11][12] - A recent acquisition in New Mexico for $608 million adds approximately 12,000 BOE per day and enhances the company's operational footprint [12][13] - The company maintains a disciplined approach to mergers and acquisitions, ensuring that any new assets meet rigorous investment criteria [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current market and capitalize on opportunities, emphasizing a strong balance sheet and liquidity [5][9] - The company plans to reduce capital expenditures by $50 million while maintaining production at the high end of guidance, reflecting a dynamic approach to capital allocation [20][21] Other Important Information - The company redeemed $175 million in high-interest legacy notes, saving approximately $17 million annually in interest expenses [7] - Credit ratings have improved, with ratings of BA1 from Moody's and BB+ from S&P, positioning the company one notch away from investment grade [8] Q&A Session Summary Question: How does the New Mexico bolt-on acquisition compare to recent deals? - Management highlighted the low decline production base and the quality of inventory as key advantages of the New Mexico acquisition, which fits well with the company's M&A strategy [24][26] Question: What is the capacity for continued share buybacks? - Management indicated ample capacity for both acquisitions and share buybacks, emphasizing a patient approach to share repurchases [29][30] Question: Can you share details on the acquisition process? - The acquisition was a result of long-term discussions with the sellers, and the assets were already on the near-term drill schedule, providing a competitive advantage [37][38] Question: What is driving better-than-expected production? - The outperformance in production is attributed to the successful integration of recent acquisitions and improvements in artificial lift technology [40][41] Question: How does the company view the trade-offs in a weaker oil price environment? - The company maintains a focus on returns and flexibility, allowing for adjustments in activity based on market conditions while still generating strong returns [48][50] Question: What is the outlook for M&A opportunities? - Management expects continued opportunities for acquisitions in the Delaware Basin, particularly as motivated sellers may emerge in a downturn [59][60] Question: What is the current state of service costs in the industry? - Service costs are beginning to move lower, with some providers offering price concessions due to reduced activity [65] Question: How does the company plan to optimize the acquired assets? - The company plans to apply its peer-leading cost structure to the newly acquired assets, which have shown strong productivity [88][89]

Financial Data and Key Metrics Changes - The company achieved the highest free cash flow per share in its history at $0.54, driven by lower per unit costs and solid production performance [4] - Adjusted operating cash flow reached $900 million, and adjusted free cash flow was $460 million, with cash capital expenditures of $500 million [6] - Cash on the balance sheet increased from $479 million at year-end to approximately $700 million by March 31, and leverage decreased from 1x to 0.8x [6][7] Business Line Data and Key Metrics Changes - Oil production was 175,000 barrels per day, and total production was 373,000 barrels of oil equivalent per day, exceeding expectations [5] - Controllable cash costs were reduced by 4%, and drilling and completion costs decreased by 3%, landing at $750 per foot for the quarter [6] Market Data and Key Metrics Changes - Approximately 25% of 2025 oil production is hedged at a price just above $73 per barrel, allowing the company to be more opportunistic during downturns [9] - The company has maintained a strong balance sheet with updated credit ratings of BA1 from Moody's and BB+ from S&P, positioning it one notch away from investment grade at all three rating agencies [7] Company Strategy and Development Direction - The company is focused on opportunistic investments during downturns, aiming to acquire high-quality assets with low breakeven costs [11][12] - A recent acquisition in New Mexico for $608 million is expected to enhance returns and add over 100 new gross operating locations [12][14] - The company emphasizes maintaining a strong balance sheet while executing share buybacks and acquisitions simultaneously [18][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current market and capitalizing on opportunities, highlighting the importance of a strong balance sheet [4][10] - The company plans to reduce capital expenditures by $50 million while maintaining production at the high end of guidance, indicating a flexible approach to capital allocation [19][20] - Management noted that the oil and gas industry will always have volatility, which creates potential for outsized value creation [11] Other Important Information - The company has a disciplined approach to mergers and acquisitions, ensuring that any new acquisitions meet rigorous investment criteria [15][16] - The acquisition in New Mexico is expected to generate over 5% free cash flow per share accretion in the near, mid, and long term [14] Q&A Session Summary Question: How does the New Mexico bolt-on deal compare to recent deals? - Management expressed excitement about the deal, highlighting its fit with the M&A strategy and the quality of the inventory [22][24] Question: What is the capacity for continued share buybacks? - Management indicated ample capacity for both acquisitions and share buybacks, emphasizing a patient approach to market opportunities [27][28] Question: Can you share how the New Mexico deal came about? - The deal was a culmination of discussions over several years, with a competitive advantage due to existing operational familiarity [33][35] Question: What is driving better-than-expected production? - The outperformance is attributed to two larger acquisitions from 2024, with improved artificial lift and operational practices leading to higher production [37][38] Question: How do you view the trade-offs of responding to oil price changes? - Management emphasized a returns-focused approach, maintaining flexibility to adjust activity based on market conditions [45][46] Question: What is the outlook for service costs? - Service costs are beginning to move lower, with some price concessions being observed due to reduced activity in the industry [60][61] Question: How do you see organic inventory expansion opportunities? - Management is optimistic about continuing to add inventory through organic means, particularly in the Delaware Basin [85][88]

Ma y 7 , 2 0 2 5 Q1'25 Earnings Presentation Important Information Forward-Looking Statements The information in this presentation includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact included in this press release, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs ...

Core Insights - Permian Resources reported revenue of $1.38 billion for Q1 2025, reflecting a year-over-year increase of 10.7% [1] - The company's EPS remained stable at $0.42, matching the previous year's figure, but fell short of the consensus estimate of $0.44, resulting in an EPS surprise of -4.55% [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $1.39 billion, leading to a revenue surprise of -1.22% [1] Financial Performance Metrics - Average daily net production totaled 373,209 BOE/D, exceeding the six-analyst average estimate of 368,855 BOE/D [4] - Natural gas production averaged 673,388 Mcf/D, surpassing the five-analyst average estimate of 640,427.8 Mcf/D [4] - Oil production reached 174,967 BBL/D, which was above the five-analyst average estimate of 171,776 BBL/D [4] - Average sales price for oil, including derivative cash settlements, was $71.45, slightly below the four-analyst average estimate of $71.63 [4] - Net revenues from oil sales were reported at $1.11 billion, aligning with the two-analyst average estimate [4] Stock Performance - Shares of Permian Resources have increased by 15.5% over the past month, outperforming the Zacks S&P 500 composite's increase of 10.6% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]