MTDR

Matador Resources is a well-run Delaware Basin (Permian) oil and gas producer that combines growth, strong margins and a low valuation. Even against a weakening oil-price backdrop, FY2025 revenue grew 5.1% to $3.66B — the company's production growth and acreage quality offsetting price declines — though net income fell 14.2% to $759M and EPS to $6.09 as realized prices softened. The profitability is impressive for the sector: a 33.5% operating margin, 20.8% net margin and 13.4% ROE reflect low-cost, high-quality acreage. Operating cash flow grew 7.9% to $2.43B.

Capital allocation has shifted in a shareholder-friendly direction. After a heavy investment year, capex was cut 44.8% to $2.16B (digesting prior acquisitions and moderating the drilling program), bringing spend below operating cash flow and freeing cash for returns: the dividend jumped 55.5% to $163M and the company began buybacks ($55.8M). Equity grew 11.2% to $5.66B and retained earnings rose 23.3% to $3.15B. At $49.56 the stock trades at just 8.1x EPS and 1.7x sales — a clearly cheap multiple for a profitable, growing E&P.