Permian Resources Stock: Not a Buy Yet, But Still Worth Holding

Core Insights - Permian Resources Corporation (PR) has outperformed both the U.S. Oil & Gas Exploration & Production sub-industry and the broader Zacks Oil and Energy Sector with a growth of 7.6% over the past three months, while its sub-industry declined by 1.6% and the sector increased by 3.3% [1][4][8] Stock Performance - The Zacks Consensus Estimate for PR's earnings per share has increased by 5.43% for 2025 but decreased by 1.65% for 2026 over the past 60 days [3] Operational Performance - PR reported a 6% sequential increase in oil output to 186.9 MBbls/d in Q3 2025, leading to an increase in full-year production guidance, marking the 12th consecutive quarter of strong operational performance [5][8] Financial Position - The company reduced its total debt by 11% in Q3 to $3.6 billion, achieving a low leverage ratio of 0.8x, and received an investment-grade rating from Fitch with a positive outlook from Moody's [6][9] Acquisition Strategy - PR executed 250 transactions in Q3 2025, enhancing its high-quality acreage in the Delaware Basin, and management claims the acquisition pipeline is the strongest ever, supporting low-cost inventory growth [10][11] Asset Quality - PR owns approximately 475,000 net acres in the core Delaware Basin, recognized for its high-quality oil resources, which supports durable, high-margin production [11] Challenges - The company faces risks related to oil and gas price volatility, execution and integration risks from its aggressive acquisition strategy, and geographic concentration in the Permian Basin, which exposes it to region-specific risks [12][13][14] Cost Pressures - Although currently benefiting from lower service costs, potential rebounds in commodity prices could lead to increased drilling and completion costs, impacting capital efficiency [15] Overall Assessment - PR has shown consistent operational outperformance and a solid balance sheet, positioning it for long-term success, but investors may consider waiting for a more favorable entry point due to existing challenges [16][17]