Matador’s CEO Foran more than doubles direct stake in a $256,800 buy (NYSE: MTDR)

What happened

Matador Resources Co (NYSE: MTDR) Chairman and CEO Joseph Wm Foran bought 5,000 shares on Nov. 5. The purchase more than doubled Foran's direct holding, which stands at 9,772 shares after the trade.

The filing reports a weighted average price of $51.36. The shares were bought in multiple transactions at prices from $51.17 to $51.55, for a total of about $256,800.

Foran, who is also a director, reports 13 indirect holdings in the filing, held through family trusts, a family limited partnership and other vehicles. The direct holding includes shares acquired through the Employee Stock Purchase Plan, the filing says.

Key numbers

Metric	Latest	Change	Source
Shares bought	5,000 shares		SEC Form 4
Weighted average price per share	$51.36		SEC Form 4
Total purchase value	$256,800		SEC Form 4
Direct holding after the purchase	9,772 shares		SEC Form 4
Purchase as a share of prior direct holding	104.8%		Calculated from SEC Form 4

Read more: Matador Resources (MTDR) company research

Why it matters

The purchase was large relative to Foran's direct stake. By OptimistFi's calculation, the 5,000 shares equal 104.8% of the 4,772 shares held directly before the trade.

OptimistFi has argued that Matador turns drilling and integrated midstream assets into repeatable free cash flow and shareholder returns. A share purchase by the CEO adds modest support to that view.

The filing reports the direct holding separately from the indirect holdings. The post-trade direct figure counts only shares Foran holds in his own name, including those from the Employee Stock Purchase Plan.

The indirect shares sit in family trusts, a family limited partnership and other vehicles. The purchase therefore moves only the smaller of the two pools of ownership.

The direct stake is small next to the indirect holdings the filing lists. Those include 1,347,912 shares held by the 2020 Non-GST Trusts and 1,105,913 held by Sage Resources, Ltd., a family limited partnership.

Foran is trustee of eight of the indirect holdings, each held by a GRAT, and has sole voting and investment power over those shares. Foran disclaims beneficial ownership of the indirect shares except to the extent of a pecuniary interest. One purchase leaves Matador's operating picture unchanged.

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What's next

Matador's next quarterly report is the next test of the case. Stronger free cash flow and shareholder returns would back OptimistFi's view, and weaker figures would undercut it.

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• MTDR stock: research and coverage of Matador Resources
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