Matador Divests South Texas Assets, Strengthens Balance Sheet

Core Insights - Matador Resources Company (MTDR) has divested its remaining acreage in the Eagle Ford Basin, focusing on the northern Delaware Basin for future development [1][3] - The company generated over $30 million from the sale of its assets in La Salle, Karnes, and Atascosa Counties [2] - Matador has reduced its debt by $180 million, currently holding $405 million in outstanding debt, while maintaining approximately $1.8 billion in liquidity [4] Divestment Details - The divestment included highly productive assets that were a key part of MTDR's production base [2] - The company executed the sale through several transactions over the past two quarters [2] - The exit from the Eagle Ford Basin marks a strategic shift towards the more prolific northern Delaware Basin, where MTDR owns 200,000 acres [3] Financial Position - Proceeds from the sale and internal cash flows were used to pay down debt, enhancing the company's financial stability [4] - The company is pursuing a strategy of hedge protection and divestment of non-core assets to strengthen its balance sheet [4] Market Conditions and Strategy - Matador is optimistic about its drilling plans for 2025, despite anticipated increases in steel prices due to tariffs [5] - The company has taken precautionary measures by purchasing necessary inventory for its drilling program [5] - Historically, MTDR has made successful acquisitions during volatile market conditions, contributing to its long-term success [6] Stock Repurchase Program - The board of directors is considering a stock repurchase program in light of declining stock prices, in addition to the existing quarterly dividend of 31.25 cents per share [1][7] Industry Context - Matador Resources holds a Zacks Rank 3 (Hold), indicating a stable outlook within the energy sector [8] - Other energy companies with better rankings include Archrock Inc. (Rank 1), Nine Energy Service (Rank 2), and Kinder Morgan, Inc. (Rank 2) [8]