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MNR: Higher Future Multiple May Reward Moderate Profitability Expectations

Growing US Natural Gas Demand Will Unlock Long-Term Value

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MNR
AnalystConsensusTarget
Not Invested
Published 01 May 2025

Update shared on 08 Dec 2025

Fair value Decreased 5.56%
Previous
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AnalystConsensusTarget's Fair Value
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1Y
-25.5%
7D
-3.7%

Analysts have trimmed their 12 month price target on Mach Natural Resources from approximately $21.00 to about $19.83 per share, citing expectations for slower revenue growth and moderating profit margins, partly offset by a higher assumed future price to earnings multiple.

What's in the News

  • Reported third quarter 2025 operating results, with average total net production of 94,000 Mboe/d and highlighted continued scale in its upstream portfolio (Key Developments)
  • Recorded a $90.43 million impairment charge on oil and gas properties for the third quarter of 2025, signaling reassessment of asset values amid changing market conditions (Key Developments)
  • Declared a reduced quarterly cash distribution of $0.27 per common unit for the third quarter of 2025, payable on December 4, 2025 to unitholders of record on November 20, 2025 (Key Developments)

Valuation Changes

  • Fair Value Estimate was lowered moderately from approximately $21.00 to about $19.83 per share, reflecting a slightly more conservative outlook on intrinsic value.
  • The discount rate edged down slightly from about 7.29 percent to roughly 7.17 percent, implying a marginally lower required return on equity.
  • Assumed revenue growth was reduced significantly from 20.59 percent to 14.61 percent, indicating more moderate expectations for top line expansion.
  • The net profit margin was cut materially from 21.80 percent to 16.88 percent, signaling expectations for weaker operating profitability.
  • The assumed future P/E multiple increased sharply from roughly 10.5x to about 20.7x, indicating a higher valuation multiple on expected earnings despite softer fundamentals.

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Disclaimer

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