Granite Ridge Resources’ first quarter was met with a negative market reaction as both revenue and non-GAAP earnings per share missed Wall Street expectations. Management attributed the underperformance primarily to weak realized oil and natural gas prices in the Permian Basin, with CEO Tyler Parkinson stating that “service costs—primarily saltwater disposal—increased, a dynamic that is structural in the basin.” The company’s ongoing strategic shift toward operated partnerships helped drive double-digit oil production growth, but higher operating expenses and pricing headwinds weighed on overall profitability.
Is now the time to buy GRNT? Find out in our full research report (it’s free for active Edge members).
Granite Ridge Resources (GRNT) Q1 CY2026 Highlights:
- Revenue: $128.3 million vs analyst estimates of $129.5 million (4.3% year-on-year growth, 0.9% miss)
- Adjusted EPS: $0.02 vs analyst expectations of $0.11 (81% miss)
- Adjusted EBITDA: $71 million vs analyst estimates of $87.74 million (55.4% margin, 19.1% miss)
- Operating Margin: 11.6%, down from 34.6% in the same quarter last year
- Oil production: up 11.4% year on year
- Market Capitalization: $680.6 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Granite Ridge Resources’s Q1 Earnings Call
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Phillips Johnston (Capital One) asked about the drivers behind the weak realized oil and gas prices, especially the impact of Waha basis for gas. CFO Kyle Kettler explained that negative differentials were modeled into future plans and are expected to improve slightly later in the year.
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Phillips Johnston (Capital One) inquired about the planned well count and production mix for 2026. Kettler confirmed 29 net wells are planned, with a tilt back toward oil and more Permian activity as the year progresses.
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Derek Whitfield (Texas Capital) questioned whether the move toward free cash flow in 2027 is driven by leverage targets or opportunity set. CEO Tyler Parkinson clarified that leverage discipline is the main driver, with capital allocation designed for a $60 oil environment.
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Jerry Giroux (Stephens) asked about the future use of free cash flow—whether it would be returned to shareholders or retained. Parkinson noted it is “TBD,” emphasizing flexibility and a focus on making the best decision based on circumstances at the time.
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Noah Hungness (Bank of America) asked about the current opportunity for inventory additions and market competitiveness. Parkinson indicated that operator teams continue to find attractive opportunities, particularly in the Permian and Utica Shale, and the deal flow remains robust.
Catalysts in Upcoming Quarters
In the upcoming quarters, the StockStory team will be watching (1) the pace and efficiency of operated partnership project execution, (2) trends in realized oil and gas prices, especially in the Permian Basin, and (3) Granite Ridge Resources’ ability to moderate capital spending while sustaining production growth. The evolution of service costs and the company’s progress toward free cash flow will also be critical signposts.
Granite Ridge Resources currently trades at $5.26, down from $5.60 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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