Permian Resources Corp 2Q26 Flash: Successful A&D Small Buy and Guidance Raise; Stock Reaction-Positive

Research evidence excerpt

J P M O R G A N

North America Equity Research

05 August 2026

Permian Resources Corp

2Q26 Flash: Successful A&D Small Buy and Guidance

Raise; Stock Reaction-Positive

Overweight

PR, PR US

Price (04 Aug 26):$20.50

Oil & Gas Exploration & Production

JPM View: Stock Reaction – Positive. Against what we perceive were relatively

high expectations ahead of the print, we anticipate a positive reaction to the print,

which featured a ~10% cash flow beat, ~2% oil beat, full-year guidance bump, and the

successful addition of low cost locations via its successful ground game in the

Delaware Basin. PR delivered 2Q26 oil production of 198 MBo/d, which topped

JPMe of 194.8 MBo/d by 2% and the Street’s 195.8 MBo/d forecast by 1%, reflecting

higher workover activity (up 50% sequentially) and higher working interest on the

back of $1.05bn of overall A&D activity in the quarter. We do note that the company’s

A&D efforts drove a 7% increase in the average working interest in 2Q26

completions, which was a driver of the beat. As largely telegraphed, 2Q26 natural gas

production of 553 MMcf/d was 10% below our forecast as the company shut-in higher

GoR wells in response to cyclical low Waha prices – a positive outcome in a negative

pricing environment. The only fly in the ointment was a higher capex print of

$521mm, which was +4%/+5% above JPMe/STe, but we note that FCF still handily

surpassed expectations. We expect the company to get credit for the success of its

ground game, which added significant resource at relatively low acquisition costs

relative to its Delaware Basin peers. The company noted that it added 54K net acres

and 20K NRAs for a total cost of $1.05bn through 190 separate transactions. They

noted a transaction price of $13K per net acre and $8K per NRA. The company

estimates that it added 330 net locations (10K laterals) to its inventory at an attractive

acquisition cost of $2.5mm per location. This compares to the $7.3mm and $6.5mm

per location cost paid by Matador (MTDR) and Devon (DVN) in the recent Federal

lease sale, although the Federal lease sale did include higher NRIs of 87.5% and

acreage in the core of the core. PR bumped its 2026 oil guide to 199 MBo/d, which

…