Matador Resources Company (MTDR)

[Timothy Smith]

Here are seven reasons why Matador has long-term value for investors at $10 a share:

Insiders have purchased over 200,000 net shares so far in 2012.

After falling some 20% since the IPO in February, the stock is cheap at just 6 times forward earnings.

Revenues are exploding at Matador. The company had more realized revenues in Q1 2012 than all of FY 2009. Analysts expect over an 60% sales increase in FY 2013 as well.

The company is tilting more and more of its capital budget toward oil, primarily in the Eagle Ford region, where 84% of its FY 2012 capital budget is allocated. This resulted in a fivefold increase in oil production in FY 2011 and the company has projected a tenfold increase in oil production in FY 2012 over FY 2011.

The majority of both oil and natural gas production is hedged for both FY 2012 and FY 2013.

The seven analysts who cover the stock have a $15 median price target on Matador.

The company carries little debt, increased cash flow around 140% from FY 2010 to FY 2011, and earnings are expected to come in at approximately $1 a share in FY 2012 and $1.65 a share in FY 2013.