Street Beats: Magnolia Oil and Gas Reports Q3 Financial Results

The PRISM Oil and Gas Index company Magnolia Oil & Gas (MGY) recently reported Q3 financial results with EPS, EBITDA, and capex beats. Q3 EPS was $0.52 vs FactSet $0.48 and revenue was $333.1M vs FactSet $327.7M. Total production missed while oil production came in slightly above the Street. The company expects Q4 D&C capital to be ~$125M which factors in the small amount of delayed activity as well as the additional four well pad which would bring Magnolia’s total capital spend for the year to ~$470M and in the middle of the range of its total 2024 capital budget of $450 to $480M.

Analysts overall were positive on the update and highlighted the capex and oil production beats, solid pricing and strong FCF results. Q4 production guidance is inline with the Street while Q4 capex came in hot but incorporates an added 4-well pad during the quarter to take advantage of improved costs. Magnolia guided 2025 growth to mid-single digits.

Magnolia President and CEO Chris Stavros stated, “During the third quarter, we continued to grow our production in a highly capitally efficient manner, yielding total volumes of 90.7 thousand barrels of oil equivalent per day and 38.9 thousand barrels per day of oil, despite some unplanned third-party midstream outages. Our team’s continued focus on driving down field-level operating costs has also helped our pre-tax margins and improved our free cash flow. I am very proud of the hard work and concerted effort shown by our operating personnel, helping to provide Magnolia with one of the lowest cost structures in the industry.”