On August 6, Permian Resources (NYSE:PR) posted the best quarter in its history. Free cash flow hit $751 million in the second quarter of 2026, up nearly 50% from the prior quarter, with free cash flow per share of $0.88. Oil production climbed to roughly 198,000 barrels per day, up 3% quarter-over-quarter.
For a company that spent much of the last few years proving out its model, this was the quarter that model paid off in full. Management leaned hard into a volatile commodity environment rather than waiting it out. The company added workover rigs at a 50% higher clip, pulling incremental barrels out of existing wells fast.
Working interest in completed wells rose to about 82% for the quarter, well above the original 75% target, adding 6,000 barrels per day of oil growth for $521 million in capital spending. On the gas side, when WAHA prices averaged negative $3.14 per Mcf and dipped as low as negative $9.52, Permian Resources curtailed roughly 20% of natural gas production rather than sell into a loss, still realizing $0.38 per Mcf and an extra $75 million in revenue. Dealmaking has been just as active.
Year-to-date, the company has acquired about 55,000 net acres in the Delaware Basin for roughly $1.05 billion across some 190 separate transactions, including a $520 million Ward County purchase and a 15,000-acre Eddy County bolt-on sourced through a longtime industry relationship. Leverage sits near 0.5 times, and updated 2026 guidance calls for 199,000 barrels of oil per day, 10% above 2025, on capital spending that is actually about 1% lower than last year. Some of what made this quarter look good is also a reminder of how exposed the business remains.
WAHA gas pricing swinging to negative $9.52 per Mcf shows just how oversupplied the regional gas market can get, and curtailing wells only works as a strategy until it doesn't. The freshly acquired Ward County acreage was, in the company's own telling, majority non-operated, low working interest, and scattered before a follow-up trade fixed the layout, a sign that even well-sourced deals can arrive needing more work. And growth by 190 small transactions instead of one large deal means more moving pieces to integrate and more land teams to keep executing at a high level quarter after quarter.
Hedge fund ownership held flat, with 56 funds in the most recent quarter versus 56 the quarter before, showing no shift in institutional conviction either way. Short interest sits at just 2.76% of float, a level that suggests little organized skepticism toward the stock. The forward price-to-earnings ratio of 10.67, as of August 13, is modest for a company guiding to double-digit production growth on flat capital spending.
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