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It has been about a month since the last earnings report for Magnolia Oil & Gas Corp (MGY). Shares have added about 2.3% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Magnolia Oil & Gas Corp due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Magnolia Oil & Gas Corp before we dive into how investors and analysts have reacted as of late.
Magnolia Oil & Gas reported a third-quarter 2025 net profit of 41 cents per share, which was in line with the Zacks Consensus Estimate. This can be attributed to a healthy increase in production volumes. However, the bottom line decreased from the year-ago quarter’s 52 cents due to a 9.5% increase in operating expenses.
The oil and gas exploration and production company reported total revenues of $324.9 million, beating the Zacks Consensus Estimate of $322 million, driven by higher year-over-year revenues from natural gas and natural gas liquids. However, the top line declined 2.5% from $333.1 million in the prior-year period, primarily due to lower oil revenues.
The company reported $230.5 million in revenues from oil, which decreased 13.2% from the year-ago quarter’s $265.7 million. However, it beat the model estimate of $224.6 million.
The natural gas revenues of $43.2 million nearly doubled from the year-ago quarter’s $22.2 million, beating our estimate of $41.7 million. The natural gas liquids revenues of $51.2 million increased from the year-ago quarter’s $45.2 million, beating our estimate of $50.5 million.
In the quarter under review, the company posted $247.1 million in net cash from operating activities and achieved a free cash flow of $133.9 million.
On Oct. 28, South Texas-focused Magnolia declared a cash dividend of 15 cents per share of Class A Common stock and a cash distribution of 15 cents per Class B unit, payable on Dec. 1 to its shareholders of record as of Nov. 10, 2025.
During the third quarter, the company repurchased approximately 2.15 million shares of its Class A Common Stock for a total of $51.4 million. Magnolia still has 5.2 million Class A shares available under its current buyback program, designated specifically for open market transactions. In total, Magnolia returned $80.3 million to shareholders — representing 60% of its free cash flow for the quarter — through a mix of dividends and share repurchases.
Magnolia reported the average daily total output of 100,507 barrels of oil equivalent per day (boe/d), increasing 10.8% from the year-ago quarter’s 90,702 boe/d. The figure also beat the Zacks Consensus Estimate of 90,000 boe/d.
Oil volumes totaled 39,430 barrels per day (bpd), slightly up 1.4% from the year-ago quarter’s level. However, the figure came down from our estimate of 40,500 bpd.
Natural gas volumes reached 190,384 thousand cubic feet per day (Mcf/d), up 19.6% from the third quarter of 2024. Moreover, the figure also surpassed our expectation of 183,900 Mcf/d.
Natural Gas Liquids volumes totaled 29,347 bpd, up 16.1% from the year-ago quarter’s level. Moreover, the figure exceeded our estimate of 27,800 bpd.
The average realized crude oil price was $63.55 per barrel, indicating a 14.4% decrease from the year-ago period’s $74.23. However, the figure surpassed our expectation of $60.23 per barrel.
The average realized natural gas price of $2.46 per Mcf increased significantly from the year-ago period’s $1.52. Moreover, the figure was in line with our expectations.
However, the average realized natural gas liquids price was $18.98 per barrel, implying a 2.5% decrease from the year-ago period’s figure, which also came down from our estimate of $19.75.
MGY recorded an average sales price of $35.14 per boe compared with $39.92 a year ago. However, the figure came in above our projected estimate of $34.79 per boe.
As of Sept. 30, 2025, Magnolia had cash and cash equivalents of $280.5 million. The company had long-term debt of $393.1 million, reflecting a debt-to-capitalization of 16.1%.
MGY spent $118.4 million on its capital program in the reported quarter. Operating expenses increased to $223.5 million from $204.1 million in the year-ago period.
During the fourth quarter of 2025, this company expects drilling and completion (D&C) capital spending to be approximately $110 million, bringing full-year capital expenditures near the midpoint of the previously guided range of $430-$470 million. This includes non-operated capital that remains consistent with 2024 levels. Supported by continued strong well performance, Magnolia is reiterating its full-year 2025 production growth outlook of approximately 10%, up from the initial guidance of 5-7% at the beginning of the year. Total company production for the fourth quarter is anticipated to be around 101 Mboe/d, with both total and oil production expected to reach their highest levels of the year.
Operating costs per boe are expected to ease modestly in the fourth quarter, with estimates pointing to a level of around $5.20. Full-year 2025 Lease Operating Expense is expected to be at least 5% lower than 2024 levels, indicating continued operational efficiencies.
Oil price differentials are anticipated to reflect a $3 per barrel discount to Magellan East Houston and Magnolia remains fully unhedged across its oil and natural gas production. The fully diluted share count for the fourth quarter is estimated at 189 million, representing a 4% year-over-year decline compared with the fourth quarter of 2024.
Magnolia expects to operate two drilling rigs and one completion crew, and maintain this level of activity through year-end. This development program has been consistently in place for the past four years, supporting total company production growth of approximately 50% and more than doubling volumes in Giddings. Approximately 75-80% of Magnolia’s 2025 activity is expected to be focused on multi-well development pads in the Giddings area, further de-risking the company’s sizable acreage position.
The Giddings development program spans a core 240,000 net acre area, enabling a balanced and efficient approach that delivers consistent year-over-year results. Magnolia also expects to allocate modest capital toward appraisal activities across its broader acreage footprint to further enhance long-term resource opportunity set.
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
Currently, Magnolia Oil & Gas Corp has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock has a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Magnolia Oil & Gas Corp has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Magnolia Oil & Gas Corp is part of the Zacks Oil and Gas - Exploration and Production - United States industry. Over the past month, Matador Resources (MTDR), a stock from the same industry, has gained 6%. The company reported its results for the quarter ended September 2025 more than a month ago.
Matador reported revenues of $939.02 million in the last reported quarter, representing a year-over-year change of +4.4%. EPS of $1.36 for the same period compares with $1.89 a year ago.
For the current quarter, Matador is expected to post earnings of $0.98 per share, indicating a change of -46.5% from the year-ago quarter. The Zacks Consensus Estimate has changed -7% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Matador. Also, the stock has a VGM Score of B.
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This article originally published on Zacks Investment Research (zacks.com).
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