MorningStar Partners, L.P. (TXO) AI Stock Analysis

MorningStar Partners, L.P., based in Fort Worth, Texas, specializes in the strategic acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves across North America. Founded in 2012, the partnership manages working interests covering 850,009 gross acres as of July 31, 2022. Its assets are primarily situated in the San Juan Basin across New Mexico and Colorado, as well as the Permian Basin in West Texas and New Mexico. The company applies reservoir management and production enhancement techniques to optimize extraction while maintaining environmental stewardship and regulatory compliance.

Between FY2020 and FY2025, MorningStar Partners achieved a 5-year revenue CAGR of 30.5%. Revenue rose 109.9% to $228.3M in FY2021, reached $246.4M in FY2022, and expanded 54.5% to $380.7M in FY2023. In FY2024, revenue declined 25.7% to $282.8M before rebounding 45.5% to $411.5M in FY2025. Gross margin shifted from 52.2% in FY2021 to 10.6% in FY2025, while operating margin moved from 19.4% to 5.4%. Net income was $52.5M in FY2021, -$7.7M in FY2022, -$104.0M in FY2023, $23.5M in FY2024, and -$21.6M in FY2025. In the latest quarter ended June 30, 2026, quarterly revenue grew 67.9% year-over-year, and quarterly earnings grew 1436.8%.

As of June 30, 2026, MorningStar Partners held $107.5M in cash and short-term investments against total debt of $340.1M, resulting in net debt of $232.6M. Shareholders' equity was $648.1M, with total assets of $1.25B, a debt-to-equity ratio of 0.52, and a current ratio of 1.05. In FY2025, the company generated $118.2M in operating cash flow but recorded free cash flow of -$145.4M due to capital expenditures of $263.6M. Cash deployment that year included $101.4M in dividends paid, supported by $191.4M in share issuance.

MorningStar Partners trades at an enterprise value of $950.0M and a market cap of $788.4M. Its forward P/E ratio is 12.6x, compared to the median of 12.7x for its US-listed Energy peers. Its price-to-sales ratio is 1.9x versus the peer median of 1.8x, and its EV-to-EBITDA is 10.5x compared to the peer median of 8.0x. Over the past year, the stock returned 23.2%, outperforming the S&P 500 (SPY) return of 16.8%, and it has generated a year-to-date return of 44.5%.

The company pays a quarterly dividend with an annualized forward dividend of $1.41 per share, representing a dividend yield of 9.92%. MorningStar Partners has paid consecutive dividends for 4 years, with a reported payout ratio of 3.0%. The most recent ex-dividend date was August 14, 2026.

Wall Street coverage consists of 4 Strong Buy ratings and no Buy, Hold, Sell, or Strong Sell ratings. The mean price target is $19.75, representing an upside of 38.9% from the last close of $14.22 on October 16, 2026. For the current fiscal year ending December 31, 2026, consensus estimates project revenue of $439.7M and EPS of $0.65. Over the last four quarters, the partnership beat EPS estimates 2 times. The next earnings date is scheduled for November 3, 2026.

This page is an AI-written research summary of MorningStar Partners, L.P. (TXO). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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