Intrinsic value of Matador Resources - MTDR

Previous Close

$29.57

  Intrinsic Value

$1.58

stock screener

  Rating & Target

str. sell

-95%

Previous close

$29.57

 
Intrinsic value

$1.58

 
Up/down potential

-95%

 
Rating

str. sell

We calculate the intrinsic value of MTDR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  5.81
  43.20
  39.38
  35.94
  32.85
  30.06
  27.56
  25.30
  23.27
  21.44
  19.80
  18.32
  16.99
  15.79
  14.71
  13.74
  12.87
  12.08
  11.37
  10.73
  10.16
  9.64
  9.18
  8.76
  8.39
  8.05
  7.74
  7.47
  7.22
  7.00
  6.80
Revenue, $m
  255
  365
  509
  692
  919
  1,195
  1,525
  1,911
  2,355
  2,860
  3,427
  4,055
  4,743
  5,492
  6,300
  7,166
  8,088
  9,065
  10,095
  11,179
  12,315
  13,502
  14,742
  16,034
  17,378
  18,776
  20,230
  21,741
  23,311
  24,943
  26,639
Variable operating expenses, $m
 
  1,588
  2,213
  3,009
  3,997
  5,199
  6,632
  8,310
  10,244
  12,440
  14,903
  17,634
  20,629
  23,886
  27,400
  31,164
  35,174
  39,422
  43,905
  48,617
  53,557
  58,722
  64,112
  69,730
  75,577
  81,659
  87,981
  94,552
  101,380
  108,475
  115,851
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  432
  1,588
  2,213
  3,009
  3,997
  5,199
  6,632
  8,310
  10,244
  12,440
  14,903
  17,634
  20,629
  23,886
  27,400
  31,164
  35,174
  39,422
  43,905
  48,617
  53,557
  58,722
  64,112
  69,730
  75,577
  81,659
  87,981
  94,552
  101,380
  108,475
  115,851
Operating income, $m
  -177
  -1,223
  -1,705
  -2,317
  -3,078
  -4,004
  -5,107
  -6,399
  -7,888
  -9,580
  -11,477
  -13,579
  -15,886
  -18,394
  -21,100
  -23,998
  -27,086
  -30,357
  -33,809
  -37,438
  -41,242
  -45,219
  -49,371
  -53,696
  -58,199
  -62,882
  -67,751
  -72,811
  -78,069
  -83,533
  -89,212
EBITDA, $m
  -55
  -1,048
  -1,461
  -1,986
  -2,638
  -3,431
  -4,377
  -5,484
  -6,761
  -8,211
  -9,836
  -11,638
  -13,615
  -15,765
  -18,084
  -20,568
  -23,214
  -26,018
  -28,977
  -32,087
  -35,347
  -38,756
  -42,314
  -46,022
  -49,881
  -53,895
  -58,067
  -62,404
  -66,910
  -71,594
  -76,461
Interest expense (income), $m
  27
  32
  51
  75
  106
  145
  192
  248
  313
  389
  475
  571
  678
  795
  922
  1,059
  1,206
  1,363
  1,529
  1,704
  1,888
  2,081
  2,283
  2,494
  2,713
  2,942
  3,179
  3,426
  3,683
  3,950
  4,227
Earnings before tax, $m
  -98
  -1,255
  -1,755
  -2,392
  -3,185
  -4,149
  -5,299
  -6,647
  -8,202
  -9,969
  -11,951
  -14,150
  -16,563
  -19,189
  -22,022
  -25,058
  -28,292
  -31,720
  -35,338
  -39,142
  -43,130
  -47,301
  -51,654
  -56,190
  -60,912
  -65,824
  -70,930
  -76,237
  -81,752
  -87,483
  -93,439
Tax expense, $m
  -1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -97
  -1,255
  -1,755
  -2,392
  -3,185
  -4,149
  -5,299
  -6,647
  -8,202
  -9,969
  -11,951
  -14,150
  -16,563
  -19,189
  -22,022
  -25,058
  -28,292
  -31,720
  -35,338
  -39,142
  -43,130
  -47,301
  -51,654
  -56,190
  -60,912
  -65,824
  -70,930
  -76,237
  -81,752
  -87,483
  -93,439

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  213
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  1,465
  1,790
  2,495
  3,392
  4,506
  5,860
  7,475
  9,366
  11,546
  14,022
  16,798
  19,876
  23,252
  26,923
  30,884
  35,127
  39,646
  44,434
  49,487
  54,799
  60,366
  66,188
  72,264
  78,596
  85,187
  92,042
  99,168
  106,574
  114,270
  122,268
  130,581
Adjusted assets (=assets-cash), $m
  1,252
  1,790
  2,495
  3,392
  4,506
  5,860
  7,475
  9,366
  11,546
  14,022
  16,798
  19,876
  23,252
  26,923
  30,884
  35,127
  39,646
  44,434
  49,487
  54,799
  60,366
  66,188
  72,264
  78,596
  85,187
  92,042
  99,168
  106,574
  114,270
  122,268
  130,581
Revenue / Adjusted assets
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
  0.204
Average production assets, $m
  1,099
  1,573
  2,193
  2,981
  3,960
  5,150
  6,569
  8,232
  10,147
  12,323
  14,763
  17,467
  20,435
  23,661
  27,142
  30,870
  34,842
  39,050
  43,491
  48,159
  53,052
  58,168
  63,508
  69,072
  74,865
  80,889
  87,152
  93,660
  100,424
  107,453
  114,759
Working capital, $m
  109
  -149
  -208
  -282
  -375
  -488
  -622
  -780
  -961
  -1,167
  -1,398
  -1,654
  -1,935
  -2,241
  -2,571
  -2,924
  -3,300
  -3,698
  -4,119
  -4,561
  -5,024
  -5,509
  -6,015
  -6,542
  -7,090
  -7,661
  -8,254
  -8,870
  -9,511
  -10,177
  -10,869
Total debt, $m
  574
  907
  1,343
  1,898
  2,588
  3,426
  4,426
  5,597
  6,946
  8,479
  10,197
  12,102
  14,192
  16,464
  18,916
  21,542
  24,340
  27,304
  30,431
  33,719
  37,166
  40,769
  44,530
  48,450
  52,529
  56,773
  61,184
  65,768
  70,532
  75,483
  80,629
Total liabilities, $m
  775
  1,108
  1,544
  2,099
  2,789
  3,627
  4,627
  5,798
  7,147
  8,680
  10,398
  12,303
  14,393
  16,665
  19,117
  21,743
  24,541
  27,505
  30,632
  33,920
  37,367
  40,970
  44,731
  48,651
  52,730
  56,974
  61,385
  65,969
  70,733
  75,684
  80,830
Total equity, $m
  690
  682
  951
  1,292
  1,717
  2,233
  2,848
  3,569
  4,399
  5,342
  6,400
  7,573
  8,859
  10,258
  11,767
  13,383
  15,105
  16,930
  18,855
  20,878
  23,000
  25,218
  27,533
  29,945
  32,456
  35,068
  37,783
  40,605
  43,537
  46,584
  49,751
Total liabilities and equity, $m
  1,465
  1,790
  2,495
  3,391
  4,506
  5,860
  7,475
  9,367
  11,546
  14,022
  16,798
  19,876
  23,252
  26,923
  30,884
  35,126
  39,646
  44,435
  49,487
  54,798
  60,367
  66,188
  72,264
  78,596
  85,186
  92,042
  99,168
  106,574
  114,270
  122,268
  130,581
Debt-to-equity ratio
  0.832
  1.330
  1.410
  1.470
  1.510
  1.530
  1.550
  1.570
  1.580
  1.590
  1.590
  1.600
  1.600
  1.610
  1.610
  1.610
  1.610
  1.610
  1.610
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
  1.620
Adjusted equity ratio
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -97
  -1,255
  -1,755
  -2,392
  -3,185
  -4,149
  -5,299
  -6,647
  -8,202
  -9,969
  -11,951
  -14,150
  -16,563
  -19,189
  -22,022
  -25,058
  -28,292
  -31,720
  -35,338
  -39,142
  -43,130
  -47,301
  -51,654
  -56,190
  -60,912
  -65,824
  -70,930
  -76,237
  -81,752
  -87,483
  -93,439
Depreciation, amort., depletion, $m
  122
  175
  244
  331
  440
  572
  730
  915
  1,127
  1,369
  1,640
  1,941
  2,271
  2,629
  3,016
  3,430
  3,871
  4,339
  4,832
  5,351
  5,895
  6,463
  7,056
  7,675
  8,318
  8,988
  9,684
  10,407
  11,158
  11,939
  12,751
Funds from operations, $m
  136
  -1,080
  -1,512
  -2,061
  -2,745
  -3,576
  -4,569
  -5,732
  -7,074
  -8,600
  -10,311
  -12,209
  -14,293
  -16,560
  -19,006
  -21,628
  -24,421
  -27,381
  -30,506
  -33,791
  -37,236
  -40,838
  -44,597
  -48,515
  -52,594
  -56,836
  -61,247
  -65,830
  -70,593
  -75,543
  -80,688
Change in working capital, $m
  2
  -45
  -59
  -75
  -93
  -113
  -134
  -157
  -181
  -206
  -231
  -256
  -281
  -306
  -330
  -353
  -376
  -399
  -421
  -442
  -463
  -485
  -506
  -527
  -549
  -571
  -593
  -616
  -641
  -666
  -692
Cash from operations, $m
  134
  -1,035
  -1,453
  -1,987
  -2,652
  -3,464
  -4,435
  -5,575
  -6,893
  -8,393
  -10,080
  -11,953
  -14,012
  -16,254
  -18,676
  -21,275
  -24,045
  -26,983
  -30,085
  -33,349
  -36,772
  -40,353
  -44,091
  -47,988
  -52,045
  -56,266
  -60,654
  -65,214
  -69,953
  -74,878
  -79,997
Maintenance CAPEX, $m
  0
  -122
  -175
  -244
  -331
  -440
  -572
  -730
  -915
  -1,127
  -1,369
  -1,640
  -1,941
  -2,271
  -2,629
  -3,016
  -3,430
  -3,871
  -4,339
  -4,832
  -5,351
  -5,895
  -6,463
  -7,056
  -7,675
  -8,318
  -8,988
  -9,684
  -10,407
  -11,158
  -11,939
New CAPEX, $m
  -454
  -475
  -619
  -788
  -979
  -1,190
  -1,419
  -1,662
  -1,916
  -2,176
  -2,440
  -2,704
  -2,967
  -3,226
  -3,481
  -3,729
  -3,971
  -4,208
  -4,440
  -4,668
  -4,893
  -5,116
  -5,340
  -5,564
  -5,792
  -6,024
  -6,263
  -6,509
  -6,764
  -7,029
  -7,306
Cash from investing activities, $m
  -406
  -597
  -794
  -1,032
  -1,310
  -1,630
  -1,991
  -2,392
  -2,831
  -3,303
  -3,809
  -4,344
  -4,908
  -5,497
  -6,110
  -6,745
  -7,401
  -8,079
  -8,779
  -9,500
  -10,244
  -11,011
  -11,803
  -12,620
  -13,467
  -14,342
  -15,251
  -16,193
  -17,171
  -18,187
  -19,245
Free cash flow, $m
  -272
  -1,632
  -2,247
  -3,018
  -3,962
  -5,094
  -6,426
  -7,967
  -9,723
  -11,697
  -13,889
  -16,298
  -18,920
  -21,751
  -24,786
  -28,019
  -31,446
  -35,063
  -38,865
  -42,850
  -47,016
  -51,364
  -55,894
  -60,609
  -65,512
  -70,609
  -75,904
  -81,406
  -87,123
  -93,065
  -99,242
Issuance/(repayment) of debt, $m
  185
  333
  436
  555
  690
  838
  1,000
  1,171
  1,349
  1,533
  1,719
  1,905
  2,090
  2,272
  2,451
  2,626
  2,797
  2,964
  3,127
  3,288
  3,446
  3,604
  3,761
  3,919
  4,080
  4,243
  4,411
  4,584
  4,764
  4,951
  5,146
Issuance/(repurchase) of shares, $m
  289
  1,460
  2,024
  2,734
  3,609
  4,665
  5,914
  7,368
  9,032
  10,912
  13,009
  15,322
  17,850
  20,587
  23,530
  26,674
  30,014
  33,545
  37,263
  41,166
  45,252
  49,519
  53,969
  58,602
  63,423
  68,436
  73,645
  79,059
  84,684
  90,530
  96,607
Cash from financing (excl. dividends), $m  
  468
  1,793
  2,460
  3,289
  4,299
  5,503
  6,914
  8,539
  10,381
  12,445
  14,728
  17,227
  19,940
  22,859
  25,981
  29,300
  32,811
  36,509
  40,390
  44,454
  48,698
  53,123
  57,730
  62,521
  67,503
  72,679
  78,056
  83,643
  89,448
  95,481
  101,753
Total cash flow (excl. dividends), $m
  196
  161
  213
  271
  337
  409
  488
  571
  658
  748
  839
  930
  1,020
  1,109
  1,196
  1,282
  1,365
  1,446
  1,526
  1,604
  1,682
  1,758
  1,835
  1,912
  1,991
  2,071
  2,152
  2,237
  2,325
  2,416
  2,511
Retained Cash Flow (-), $m
  -202
  -1,460
  -2,024
  -2,734
  -3,609
  -4,665
  -5,914
  -7,368
  -9,032
  -10,912
  -13,009
  -15,322
  -17,850
  -20,587
  -23,530
  -26,674
  -30,014
  -33,545
  -37,263
  -41,166
  -45,252
  -49,519
  -53,969
  -58,602
  -63,423
  -68,436
  -73,645
  -79,059
  -84,684
  -90,530
  -96,607
Prev. year cash balance distribution, $m
 
  213
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -1,086
  -1,811
  -2,463
  -3,273
  -4,256
  -5,426
  -6,796
  -8,374
  -10,164
  -12,171
  -14,393
  -16,830
  -19,478
  -22,334
  -25,393
  -28,649
  -32,098
  -35,737
  -39,562
  -43,570
  -47,760
  -52,133
  -56,690
  -61,433
  -66,365
  -71,493
  -76,822
  -82,359
  -88,114
  -94,096
Discount rate, %
 
  5.50
  5.78
  6.06
  6.37
  6.69
  7.02
  7.37
  7.74
  8.13
  8.53
  8.96
  9.41
  9.88
  10.37
  10.89
  11.43
  12.01
  12.61
  13.24
  13.90
  14.59
  15.32
  16.09
  16.89
  17.74
  18.62
  19.56
  20.53
  21.56
  22.64
PV of cash for distribution, $m
 
  -1,029
  -1,619
  -2,064
  -2,557
  -3,079
  -3,612
  -4,131
  -4,612
  -5,032
  -5,367
  -5,601
  -5,722
  -5,725
  -5,610
  -5,387
  -5,068
  -4,671
  -4,217
  -3,729
  -3,227
  -2,734
  -2,265
  -1,834
  -1,450
  -1,119
  -843
  -618
  -441
  -306
  -206
Current shareholders' claim on cash, %
  100
  60.5
  37.0
  22.9
  14.4
  9.1
  5.8
  3.7
  2.4
  1.6
  1.0
  0.7
  0.5
  0.3
  0.2
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Matador Resources Company is an independent energy company engaged in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. The Company's segments include exploration and production, and midstream. The Company's operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The Company also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana and East Texas. Additionally, the Company conducts midstream operations primarily, as of February 17, 2017, through its midstream joint venture, San Mateo Midstream, LLC (San Mateo or the Joint Venture).

FINANCIAL RATIOS  of  Matador Resources (MTDR)

Valuation Ratios
P/E Ratio -30.3
Price to Sales 11.5
Price to Book 4.3
Price to Tangible Book
Price to Cash Flow 22
Price to Free Cash Flow -9.2
Growth Rates
Sales Growth Rate 5.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -8.7%
Cap. Spend. - 3 Yr. Gr. Rate 4.3%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 83.2%
Total Debt to Equity 83.2%
Interest Coverage -3
Management Effectiveness
Return On Assets -5.4%
Ret/ On Assets - 3 Yr. Avg. -15.8%
Return On Total Capital -9.1%
Ret/ On T. Cap. - 3 Yr. Avg. -21%
Return On Equity -16.5%
Return On Equity - 3 Yr. Avg. -33.8%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 59.2%
Gross Margin - 3 Yr. Avg. 66.8%
EBITDA Margin 20%
EBITDA Margin - 3 Yr. Avg. -56.1%
Operating Margin -69.4%
Oper. Margin - 3 Yr. Avg. -120.7%
Pre-Tax Margin -38.4%
Pre-Tax Margin - 3 Yr. Avg. -113.5%
Net Profit Margin -38%
Net Profit Margin - 3 Yr. Avg. -98%
Effective Tax Rate 1%
Eff/ Tax Rate - 3 Yr. Avg. 18.5%
Payout Ratio 0%

MTDR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the MTDR stock intrinsic value calculation we used $255 million for the last fiscal year's total revenue generated by Matador Resources. The default revenue input number comes from 2016 income statement of Matador Resources. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our MTDR stock valuation model: a) initial revenue growth rate of 43.2% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 5.5%, whose default value for MTDR is calculated based on our internal credit rating of Matador Resources, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Matador Resources.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of MTDR stock the variable cost ratio is equal to 434.9%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for MTDR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.6% for Matador Resources.

Corporate tax rate of 27% is the nominal tax rate for Matador Resources. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the MTDR stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for MTDR are equal to 430.8%.

Life of production assets of 9 years is the average useful life of capital assets used in Matador Resources operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for MTDR is equal to -40.8%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $690 million for Matador Resources - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 109.219 million for Matador Resources is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Matador Resources at the current share price and the inputted number of shares is $3.2 billion.

RELATED COMPANIES Price Int.Val. Rating
EPE EP Energy Cl A 1.79 0.60  str.sell
DVN Devon Energy 35.56 0.93  str.sell
EOG EOG Resources 106.76 6.02  str.sell
SM SM Energy 21.43 5.47  str.sell
CRZO Carrizo Oil&Ga 19.00 0.07  str.sell

COMPANY NEWS

▶ Matador Resources Company Announces Upcoming Company Events   [Feb-14-18 06:30AM  Business Wire]
▶ How Our Top 5 Upstream Stocks Performed in 2017   [Jan-10-18 11:10AM  Market Realist]
▶ Matador Resources Shows Market Leadership With Jump To 82 RS Rating   [Dec-21-17 03:00AM  Investor's Business Daily]
▶ US Gasoline Inventories Add More Pain to Crude Oil Futures   [Dec-07-17 09:39AM  Market Realist]
▶ The Fourth-Best-Performing Upstream Stock Year-to-Date   [Dec-05-17 05:16PM  Market Realist]
▶ Matador Resources Scores Relative Strength Rating Upgrade; Hits Key Threshold   [Dec-04-17 03:00AM  Investor's Business Daily]
▶ Dow, S&P 500, Nasdaq Inch Up At Open As Two Big Travel Names Dive   [Nov-07-17 09:45AM  Investor's Business Daily]
▶ Matador beats Street 3Q forecasts   [Nov-06-17 07:09PM  Associated Press]
▶ Matador Resources Shows Improved Relative Strength; Still Shy Of Benchmark   [Nov-02-17 03:00AM  Investor's Business Daily]
▶ Understanding Falling US Distillate Inventories   [Sep-28-17 02:06PM  Market Realist]
▶ Matador Resources Reaches 80-Plus Relative Strength Rating Benchmark   [Sep-26-17 03:00AM  Investor's Business Daily]
▶ Matador Resources Clears Technical Benchmark, Hitting 80-Plus RS Rating   [Sep-22-17 03:00AM  Investor's Business Daily]
▶ US Gasoline Inventories Fell for 4th Time in 5 Weeks   [Sep-21-17 09:43AM  Market Realist]
▶ Why US Crude Oil Production Rose Last Week   [Sep-14-17 02:10PM  Market Realist]
▶ Why Hedge Funds May Be Turning Bearish on US Crude   [Aug-31-17 07:39AM  Market Realist]
▶ Matador meets 2Q profit forecasts   [Aug-02-17 10:43PM  Associated Press]
▶ US Gasoline Demand Falls for 2nd Time in 5 Weeks   [Jul-26-17 08:35AM  Market Realist]
▶ Will Saudi Arabias Crude Oil Export Plans Rescue Oil Prices?   [Jul-19-17 09:26AM  Market Realist]
▶ Cushing Inventories: Lowest Level since November 2016   [Jul-10-17 01:21PM  Market Realist]
▶ US Gasoline Inventories Could Help Crude Oil Bulls   [Jun-22-17 11:13AM  Market Realist]
▶ US Gasoline Consumption Rose in May   [Jun-07-17 12:35PM  Market Realist]
▶ Libyas Crude Oil Production: Boon or Bane for Oil Bulls?   [May-31-17 10:05AM  Market Realist]
▶ Matador Resources Set to Join S&P MidCap 400   [May-25-17 05:45PM  PR Newswire]
▶ Will Crude Oil Futures Rise after OPECs Meeting?   [May-22-17 08:31AM  Market Realist]
▶ US Refinery Demand Fell from an All-Time High   [May-04-17 09:01AM  Market Realist]
▶ Matador tops Street 1Q forecasts   [May-03-17 07:09PM  Associated Press]
▶ Cushing Crude Oil Inventories Hit an All-Time High   [Apr-17-17 08:41AM  Market Realist]
▶ How US Distillate Inventories Affect Diesel and Oil Prices   [Apr-13-17 12:05PM  Market Realist]
▶ US Distillate Inventories Fell for the Fifth Straight Week   [Mar-16-17 07:35AM  Market Realist]
▶ US Crude Oil Production: Highest Level since March 2016   [Mar-02-17 09:10AM  Market Realist]
Financial statements of MTDR
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

FREE DOWNLOAD
Follow us on:   twitter   twitter   twitter   twitter

ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2018. All rigths reserved.