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Granite Ridge Resources (GRNT)
NYSE:GRNT
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Granite Ridge Resources
(NYSE:GRNT)
55Neutral
Positive Factors
Earnings
Higher oil production is expected to positively impact the company's earnings estimates.
Production Guidance
The 2025 guidance beats on capex with inline oil production.
Negative Factors
Free Cash Flow
Despite a strong growth outlook, the company is expected to generate negative free cash flow.
Natural Gas Realizations
There is a concern about weak natural gas realizations affecting the company's performance.
Operating Costs
Operating costs came in higher than expected between $6.25 - $7.25/boe.
Granite Ridge Resources (GRNT) vs. S&P 500 (SPY)
Market Cap
$795.34M
Dividend Yield7.13%
Average Volume (3M)482.12K
Price to Earnings (P/E)42.7
Beta (1Y)0.66
Revenue Growth-3.56%
EPS Growth-76.47%
CountryUS
Employees3
SectorEnergy
Sector Strength82
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.14
Shares Outstanding130,812,700
10 Day Avg. Volume367,801
30 Day Avg. Volume482,122
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.14
Price to Cash Flow (P/CF)2.90
P/FCF Ratio2.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.06Price Target Upside31.06% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
Granite Ridge Resources Business Overview & Revenue Model
Company DescriptionGranite Ridge Resources, Inc. manages private funds with interests in areas of the Midland, Delaware, Bakken, Eagle Ford, DJ, and Haynesville play. It invests in oil and gas exploration and production. The company is based in Dallas, Texas.
How the Company Makes MoneyGranite Ridge Resources generates revenue primarily through the sale of oil and natural gas extracted from its owned or operated properties. The company's key revenue streams include crude oil sales, natural gas sales, and, at times, the sale of natural gas liquids (NGLs). Prices for these commodities can vary based on market conditions, influencing the company's earnings. Additionally, Granite Ridge Resources might engage in strategic partnerships or joint ventures to enhance its exploration and production capabilities, thereby potentially increasing its revenue opportunities. The company may also invest in technological advancements to improve recovery rates and operational efficiency, indirectly supporting its financial performance.
Granite Ridge Resources Financial Statement Overview
Summary
Granite Ridge Resources faces significant revenue generation and profitability challenges, as evidenced by recent financial metrics. While its equity position is solid, high leverage poses risks. However, strong operating cash flows indicate potential for recovery and stability if revenue issues are addressed.Income Statement
Granite Ridge Resources' income statement shows significant volatility in revenue and profit margins. The most recent year reports zero revenue, leading to negative gross profit, though previous years showed stable revenue growth. Net profit margins have been inconsistent, reflecting challenges in maintaining profitability.30
Negative
Balance Sheet
The balance sheet indicates a high level of leverage with a substantial debt-to-equity ratio, although this has fluctuated over the years. The equity ratio remains strong, suggesting the company has a solid equity foundation. However, the decline in total assets and equity is a potential concern.55
Neutral
Cash Flow
The cash flow statement highlights strong operating cash flows, which have been consistent. Free cash flow has improved significantly, turning positive in the most recent year after a period of negative flows, demonstrating better financial health and operational efficiency.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 380.03M | 394.07M | 470.52M | 273.09M | 81.10M | Gross Profit |
| 354.02M | 145.18M | 422.12M | 245.79M | 60.04M | EBIT |
| 59.26M | 117.26M | 302.14M | 4.40M | -30.02M | EBITDA |
| 219.97M | 271.56M | 382.94M | 203.23M | 62.94M | Net Income Common Stockholders |
| 18.76M | 81.10M | 262.34M | 3.77M | -25.77M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 9.42M | 60.86M | 50.83M | 740.35K | 1.29M | Total Assets |
| 1.04B | 927.10M | 794.78M | 17.00M | 40.78M | Total Debt |
| 205.00M | 110.00M | 0.00 | 1.10M | 6.40M | Net Debt |
| 195.58M | 99.57M | -50.83M | 359.65K | 5.11M | Total Liabilities |
| 401.13M | 255.46M | 172.37M | 2.02M | 7.57M | Stockholders Equity |
| 635.35M | 671.64M | 622.40M | 14.97M | 33.21M |
| Cash Flow | Free Cash Flow | |||
| 275.73M | -56.33M | 111.70M | -213.81M | -50.58M | Operating Cash Flow |
| 275.73M | 302.87M | 346.39M | 5.47M | 66.81M | Investing Cash Flow |
| -310.77M | -356.68M | -230.56M | 21.28M | -116.74M | Financing Cash Flow |
| 33.72M | 13.41M | -76.85M | -27.30M | 52.07M |
Granite Ridge Resources Technical Analysis
Positive
6.15
Price Trends
5.99
Positive
6.12
Positive
6.06
Positive
Market Momentum
0.08
Negative
58.50
Neutral
68.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GRNT, the sentiment is Positive. The current price of 6.15 is above the 20-day moving average (MA) of 5.89, above the 50-day MA of 5.99, and above the 200-day MA of 6.06, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 58.50 is Neutral, neither overbought nor oversold. The STOCH value of 68.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GRNT.
Granite Ridge Resources Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $627.31M | 6.85 | 19.07% | 4.94% | 15.30% | 11.45% | |
70 Outperform | $766.24M | 2.02 | -6.33% | ― | 26.15% | -114.03% | |
58 Neutral | $9.12B | 5.24 | -7.59% | 7.51% | 0.53% | -65.25% | |
55 Neutral | $795.34M | 42.70 | 2.85% | 7.13% | -3.56% | -76.47% | |
47 Neutral | $957.69M | ― | -108.21% | 6.56% | -28.68% | -4373.94% | |
42 Neutral | $654.85M | ― | -89.17% | ― | -2.52% | -450.75% |
* Energy Sector Average
Performance Comparison
GRNT
Granite Ridge Resources
6.15
0.08
1.32%
DK
Delek US Holdings
15.48
-15.09
-49.36%
VTLE
Vital Energy
20.80
-33.13
-61.43%
NBR
Nabors Industries
42.84
-47.50
-52.58%
REPX
Riley Exploration Permian
30.00
-1.89
-5.93%
TXO
TXO Energy Partners LP
18.62
2.36
14.51%
Granite Ridge Resources Earnings Call Summary
Earnings Call Date: Mar 6, 2025 | % Change Since: 16.26% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong production growth, successful partnership strategies, and cost efficiencies, which were somewhat offset by a reported net loss, decreased EBITDAX, and asset impairments. The forward-looking strategy and maintained dividends suggest confidence in future performance.Highlights
Record Production in Fourth Quarter
Granite Ridge achieved a record production of 27,000 BOE per day in the fourth quarter, marking a 10% sequential increase.
Oil and Gas Production Exceeds Expectations
Gas production increased by 4% and oil production by 16% in the fourth quarter of 2024, surpassing previous expectations of a 10% gas production decline and modest oil increase.
Strong 2025 Production Guidance
Granite Ridge projects a 16% increase in production for 2025, with a targeted oil weighting of 52%.
Successful Operated Partnership Strategy
Investments in operated partnerships in 2024 yielded an estimated internal rate of return of 24% across 38 wells in the Delaware Basin.
Improved Cost Efficiency
Per unit lease operating expenses decreased by 7% in Q4 year-over-year, and full-year LOE improved by 8% over 2023.
Consistent Dividend Payouts
Granite Ridge maintained a regular quarterly dividend of $0.11 per share, with a projected robust dividend yield of over 7.5% for 2025.
Lowlights
Fourth Quarter Net Loss
Reported a net loss of $11.6 million or $0.09 per diluted share in the fourth quarter of 2024.
Decrease in Adjusted EBITDAX for 2024
Adjusted EBITDAX for 2024 was $290.8 million, down from $305.4 million in 2023, attributed to lower realized commodity prices and asset divestitures.
Impairments in Williston Basin Assets
Impairment in the Williston Basin due to lack of additional CapEx investment and maturing of assets.
Company Guidance
During Granite Ridge Resources’ earnings call, the company provided robust guidance for 2025, highlighting a planned capital expenditure (CapEx) range of $300 million to $320 million, with 56% allocated to Operative Partnerships and the rest to traditional non-operated interests. The company anticipates a 16% production growth, reaching 29,000 barrels of oil equivalent per day, with an oil weighting of 52%. They expect a steady gas production through the first three quarters, with an increase in the fourth quarter. They are targeting full-cycle returns greater than 25%, with a notable internal rate of return of 24% from their initial projects. Granite Ridge also projected a strong 15% growth in production per share and emphasized maintaining a target leverage of less than 1.25 times net debt to adjusted EBITDAX. They plan to fund their CapEx and fixed dividend from internally generated cash flow and existing liquidity, with an option to increase CapEx by $60 million to $80 million, depending on market conditions.Granite Ridge Resources Corporate Events
Business Operations and Strategy
Granite Ridge Resources Updates Investors on Strategy
Neutral
Jan 29, 2025
On January 29, 2025, Granite Ridge Resources released an Investor Presentation on its website, providing stakeholders with updated insights into its business strategy and market positioning. This release may impact investor perceptions and engagement as the company continues to disseminate relevant information periodically.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.