Magnolia Oil & Gas (MGY) AI Stock Analysis

• Market Cap: $3.95B
• Dividend Yield: 2.65%
• Average Volume (3M): 3.94M
• Price to Earnings (P/E): 10.5
• Beta (1Y): 0.94
• Revenue Growth: 7.25%
• EPS Growth: -4.99%
• Country: US
• Employees: 252
• Sector: Energy
• Sector Strength: 44
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 1.94
• Shares Outstanding: 188,523,800
• 10 Day Avg. Volume: 3,679,469
• 30 Day Avg. Volume: 3,938,576
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.72
• Price to Cash Flow (P/CF): 5.60
• P/FCF Ratio: 10.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $25.38
• Price Target Upside: 24.53% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 10

Magnolia Oil & Gas is well-positioned with a strong balance sheet, zero debt, and efficient cash generation. Technical indicators and valuation suggest a positive outlook, supported by recent earnings call highlights. However, challenges in maintaining net income growth and potential overbought conditions could impact future performance.

Positive Factors

Cash Flow

MGY is expected to generate attractive free cash flow for the next several years, allowing for consistent capital returns.

Dividends

The company announced a 15% increase to its quarterly base dividend, exceeding expectations and its long-term target for annual dividend growth.

Negative Factors

Production Disruptions

MGY reported production disruptions due to unplanned midstream outages that impacted volumes during Q3.

Production Guidance

The first quarter of 2025 volume guidance is slightly below some expectations, signaling potential challenges in meeting higher forecasts.

Magnolia Oil & Gas Business Overview & Revenue Model

Company Description

Magnolia Oil & Gas Corporation is an independent oil and natural gas producer operating primarily in the United States. The company focuses on the acquisition, development, exploration, and production of oil and natural gas resources, with its core operations concentrated in the Eagle Ford Shale and Austin Chalk formations in South Texas. Magnolia Oil & Gas is committed to leveraging its technical expertise and operational efficiency to maximize resource recovery and shareholder value.

How the Company Makes Money

Magnolia Oil & Gas generates revenue primarily through the production and sale of crude oil and natural gas. The company's revenue streams are derived from extracting hydrocarbons from its operated properties, which are then sold in the commodities markets. Key factors contributing to its earnings include production volumes, commodity prices, and operational efficiencies. Additionally, Magnolia Oil & Gas may engage in strategic partnerships or joint ventures to optimize its asset portfolio and enhance production capabilities, although specific partnerships are not detailed here.

Magnolia Oil & Gas Financial Statement Overview

Summary

Magnolia Oil & Gas shows solid financial health with strong operational margins and prudent management, featuring zero debt. Revenue and cash flow trends are positive, but maintaining net income growth is a challenge. The strong balance sheet and efficient cash generation offer a stable platform for growth.

Income Statement

The income statement shows a mixed trend for Magnolia Oil & Gas. The company experienced a moderate increase in revenue to $1.32 billion in TTM (Trailing-Twelve-Months) compared to $1.23 billion in the previous year, indicating a revenue growth rate of approximately 7.24%. The gross profit margin improved to 63.87% in TTM, reflecting efficient cost management. However, net profit margin decreased slightly to 27.81% in TTM from 31.66% last year, primarily due to reduced net income. EBITDA margin remained strong at 68.35% in TTM, showcasing robust operational performance. The company needs to focus on maintaining its net income to improve profitability.

Balance Sheet

Magnolia Oil & Gas exhibits a strong balance sheet with zero debt in TTM, indicating financial prudence and a significant reduction from $409.55 million in the previous year. The company has a high equity ratio of 26.75% in TTM, reflecting a solid equity position. Return on equity (ROE) stands at 48.50%, demonstrating effective utilization of shareholder funds. The company's strong cash position and equity base provide a stable financial foundation, though the company should aim to improve its asset base to enhance long-term growth.

Cash Flow

The company's cash flow performance is steady with operating cash flow increasing to $920.85 million in TTM from $855.79 million last year. Free cash flow decreased to $291.40 million in TTM from $430.90 million, mainly due to higher capital expenditure. The operating cash flow to net income ratio is robust at 2.52, indicating strong cash generation ability relative to net income. Despite the decline in free cash flow, the company maintains a healthy cash flow position with adequate liquidity to fund operations and investments.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.32B	1.23B	1.69B	1.08B	534.51M
	Gross Profit
680.69M	692.89M	1.26B	742.76M	128.81M
	EBIT
511.99M	534.49M	1.07B	602.59M	-544.41M
	EBITDA
922.00M	878.67M	1.33B	801.53M	-1.62B
	Net Income Common Stockholders
366.03M	388.30M	893.84M	559.72M	-1.87B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
260.05M	401.12M	675.44M	366.98M	192.56M
	Total Assets
2.82B	2.76B	2.57B	1.75B	1.45B
	Total Debt
392.51M	409.55M	390.38M	388.09M	391.12M
	Net Debt
-260.05M	8.43M	-285.06M	21.11M	198.55M
	Total Liabilities
853.51M	873.55M	832.39M	701.49M	614.00M
	Stockholders Equity
1.97B	1.69B	1.58B	816.76M	548.16M
Cash Flow		Free Cash Flow
431.74M	430.90M	831.55M	552.05M	87.91M
	Operating Cash Flow
920.85M	855.79M	1.30B	788.48M	310.12M
	Investing Cash Flow
-655.12M	-814.90M	-518.89M	-243.44M	-269.99M
	Financing Cash Flow
-406.80M	-315.21M	-469.34M	-370.61M	-30.20M

Magnolia Oil & Gas Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 20.38
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MGY, the sentiment is Negative. The current price of 20.38 is below the 20-day moving average (MA) of 23.66, below the 50-day MA of 23.46, and below the 200-day MA of 24.81, indicating a bearish trend. The MACD of 0.51 indicates Negative momentum. The RSI at 62.86 is Neutral, neither overbought nor oversold. The STOCH value of 57.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MGY.

Magnolia Oil & Gas Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MGY	75 Outperform	$3.95B	10.51	20.06%	2.65%	7.25%	-4.99%
MUR	74 Outperform	$2.85B	7.41	7.77%	5.87%	-12.48%	-36.47%
VIST	74 Outperform	$3.60B	7.67	33.30%	―	45.43%	16.98%
NOG	70 Neutral	$2.23B	4.38	23.82%	7.52%	29.45%	-48.29%
GPOR	58 Neutral	$3.00B	16.69	-13.60%	―	-11.68%	-123.15%
Sector *	57 Neutral	$7.56B	4.34	-4.83%	6.50%	-0.19%	-64.60%
CNX	54 Neutral	$4.26B	9.01	-2.14%	―	-4.26%	-105.72%

Magnolia Oil & Gas Corporate Events

Magnolia Oil & Gas Boosts Dividend Amid Strong Results

On February 18, 2025, Magnolia Oil & Gas Corporation announced its financial and operational results for the fourth quarter and full year 2024. The company’s net income for 2024 decreased compared to the previous year, but it achieved significant production growth and added substantial reserves. Magnolia’s disciplined capital program and low reinvestment rate delivered strong free cash flow, enabling it to return a high percentage of this cash to shareholders through dividends and share repurchases. The Board of Directors also increased the quarterly dividend by 15% and authorized additional share repurchases, reflecting confidence in the company’s financial health and operational strategy.