Raymond James on Friday affirmed a Market Perform rating on Matador Resources (NYSE:MTDR) and increased its 12-month price target to $59 from $49. The stock is trading at $52.39, and InvestingPro analysis cited in company commentary indicates a Fair Value estimate that implies notable upside from current levels.
The firm highlighted a set of natural gas marketing agreements Matador announced in late October, shortly after the company released third-quarter results. Those agreements secure firm transportation on Energy Transfer’s Hugh Brinson Pipeline and are designed to move roughly 500 MMcf/d out of the Permian toward Gulf Coast markets. Raymond James emphasized that this repositioning of gas flows should materially lift Matador’s gas realizations.
Matador has asserted that, on average since 2024, natural gas prices in Gulf Coast markets have traded about $2.00 per Mcf higher than prices at Waha. Management estimates that each $0.50 per Mcf improvement in gas realizations tied to the new arrangements would translate to roughly $90 million of additional annual revenue. Those potential revenue effects are central to Raymond James’ decision to adjust its target.
Financial profile and hedging
The $6.51 billion company carries a "GREAT" financial health score in the metrics reported alongside the analyst note. Matador has also been profitable over the last twelve months and posts a trailing price-to-earnings ratio of 8.33. In addition to gas-marketing actions, Matador added oil hedges in January for 2026 following recent commodity price appreciation. Approximately 35% to 40% of its 2026 oil production is now hedged through costless collar structures with a weighted average floor of $51.72 per barrel and a weighted average ceiling of $65.05 per barrel.
Raymond James' modeling foresees a step-up in Matador’s gas realizations beginning in the fourth quarter of 2026. The firm projects Matador’s 2-stream gas differentials to Henry Hub will improve from -$1.64 per Mcf in 2026 to -$0.49 per Mcf in 2027, reflecting the assumed benefits of the new pipeline capacity and market access.
Other corporate and analyst developments
Matador recently declared a quarterly cash dividend of $0.375 per share, payable March 10, 2026. The company has also acquired additional acreage in the Delaware Basin, a move described in its public disclosures.
Analyst reactions beyond Raymond James are mixed. Wells Fargo downgraded Matador from Overweight to Equal Weight and set a new price target of $47.00, citing capital concerns in its rationale. By contrast, Benchmark reiterated a Buy rating and a $62.00 price target even after trimming its fourth-quarter EBITDA estimate in light of weaker commodity assumptions.
On the personnel front, Matador announced the planned retirement of G. Gregg Krug, Executive Vice President - Marketing and Midstream Strategy, effective February 28, 2026. Following his retirement, Mr. Krug will continue to advise the company in the role of Special Advisor to the Chief Executive Officer.
What this means for investors
Raymond James increased its target primarily because of a stronger oil strip since its prior update and the tangible pathway to improved gas realizations from the newly secured transport capacity to the Gulf Coast. The company’s stated revenue sensitivity - roughly $90 million per $0.50 per Mcf improvement - provides a clear link between market access and earnings potential. At the same time, other brokerages have registered caution, pointing to capital allocation concerns and softer near-term commodity assumptions that temper consensus views.
Investors evaluating Matador should weigh the upside suggested by Raymond James’ modeling and the company’s fair value signals against the contrasting analyst stances, the proportion of 2026 oil production hedged, and the broader commodity environment. The announced dividend and acreage additions are concrete corporate actions, while the planned executive transition could influence marketing and midstream strategy continuity.