Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet, Inc., or any of its contributors. TheStreet Ratings quantitative algorithm evaluates over 4,300 stocks on a daily basis by 32 different data factors and assigns a unique buy, sell, or hold recommendation on each stock. Click here to learn more.
NEW YORK (TheStreet) -- Matador Resources (MTDR) - Get Report has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
TheStreet Ratings team rates MATADOR RESOURCES CO as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate MATADOR RESOURCES CO (MTDR) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- MTDR's very impressive revenue growth greatly exceeded the industry average of 19.6%. Since the same quarter one year prior, revenues leaped by 124.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for MATADOR RESOURCES CO is currently very high, coming in at 83.08%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 30.24% significantly outperformed against the industry average.
- The current debt-to-equity ratio, 0.39, is low and is below the industry average, implying that there has been successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.33 is very weak and demonstrates a lack of ability to pay short-term obligations.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, MATADOR RESOURCES CO's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- MTDR has underperformed the S&P 500 Index, declining 6.00% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- You can view the full analysis from the report here: MTDR Ratings Report