Magnolia Raises Production Outlook, Strikes WildFire Deal
The oil producer raised its quarterly dividend 9% to $0.18 a share.
Magnolia Oil & Gas (MGY), the Houston oil and gas producer, raised its 2026 production-growth outlook after second-quarter output climbed 3.4% sequentially to 106.1 thousand barrels of oil equivalent a day.
The update paired stronger standalone operations with Magnolia’s planned acquisition of WildFire Energy, which would add about 53,000 barrels of oil equivalent a day, roughly 70% oil. The added output would equal about half of Magnolia’s second-quarter production.
Oil production increased 2.9% from the first quarter to 41.9 thousand barrels a day. Drilling-and-completion capital declined 2.9% to $125 million even as output rose, while quarter-end cash increased by $171.6 million to $296 million.
Magnolia raised its standalone full-year production-growth guidance to 6% from 5% due to the stronger second-quarter result. The July update omitted quarterly revenue, net income, earnings per share, adjusted EBITDAX, free cash flow and operating margin, which had appeared in the prior three quarterly releases. Fuller guidance will follow the acquisition’s closing.
WildFire would add about 810,000 net acres and expand Magnolia’s Giddings position to more than 1.25 million net acres. The assets include a sand mine expected to supply about 80% of Magnolia’s annual consumption and more than 500 miles of gas-gathering pipelines, which the company expects to lower costs and improve margins.
Magnolia targets more than $100 million in annual acquisition synergies by the end of 2027, including about $60 million from drilling, completion and facilities work and another $40 million from field operations and corporate overhead. The synergies’ present value is estimated at roughly $700 million.
Following the acquisition, Magnolia projects more than $4.5 billion of cumulative free cash flow through 2030 and targets net debt of no more than 1.0 times EBITDA by the end of 2027. The dividend increase continued a series of raises from $0.15 a share in the third quarter of 2025 to $0.165 in the next two quarters.