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1. Company Snapshot

1.a. Company Description

Montauk Renewables, Inc., a renewable energy company, engages in recovery and processing of biogas from landfills and other non-fossil fuel sources.It operates in two segments, Renewable Natural Gas and Renewable Electricity Generation.The company develops, owns, and operates renewable natural gas (RNG) projects that capture methane and prevents it from being released into the atmosphere by converting it into either RNG or electrical power for the electrical grid.


Its customers for RNG and renewable identification numbers (RIN) include long-term owner-operators of landfills and livestock farms, local utilities, and refiners in the natural gas and refining sectors.The company was founded in 1980 and is headquartered in Pittsburgh, Pennsylvania.

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1.b. Last Insights on MNTK

Montauk Renewables' recent performance was hindered by a break-even quarterly earnings per share, failing to meet the Zacks Consensus Estimate of $0.01. The company's inability to surpass earnings expectations, despite a year-over-year improvement, suggests underlying operational challenges. Furthermore, the lack of significant growth in revenue and the absence of any notable acquisitions or new product launches during the quarter may have contributed to the disappointing earnings performance. Additionally, the company's share repurchase program, which authorizes the repurchase of up to $5,000,000 of its issued and outstanding common stock, may not be enough to offset the negative sentiment surrounding the company's recent earnings release.

1.c. Company Highlights

2. Montauk Renewables' Q3 2025 Earnings: A Deeper Dive

Montauk Renewables reported total revenues of $45.3 million for Q3 2025, a 31.3% decrease compared to $65.9 million in Q3 2024. The company's RNG operating income was $11 million, down 67.2% from $33.6 million in Q3 2024. The earnings per share (EPS) came in at $0.04, significantly beating analyst estimates of $0.00247. The revenue decline was largely attributed to the decrease in RINs prices, which impacted the company's profitability.

Publication Date: Nov -21

📋 Highlights
  • Revenue Decline:: Total revenues fell to $45.3M in Q3 2025, down 31.3% from $65.9M in Q3 2024.
  • RINs Self-Marketing Drop:: RINs self-marketing decreased by 21.2% to 12.4M, down from 15.8M in Q3 2024.
  • RNG Operating Income Drop:: RNG operating income fell 67.2% to $11M in Q3 2025 compared to $33.6M in Q3 2024.
  • Renewable Electricity Growth:: Renewable electricity production rose 7.3% to 44,000 MWh in Q3 2025 from 41,000 MWh in Q3 2024.
  • 2025 Full-Year Outlook:: RNG production remains flat at 5.8–6M MMBTUs, with RNG revenues projected at $150–170M.

Operational Performance

The company's operational performance showed some positive trends, with renewable electricity production increasing by 7.3% to approximately 44,000 megawatt hours in Q3 2025. The RNG production volumes remained relatively stable, and the company expects its RNG production volumes to range between 5.8 million and 6 million MMBTus for the full year 2025. As Sean McClain mentioned, "We continue our development efforts in North Carolina and expect our production and revenue generation activities to commence in the first quarter of 2026."

Guidance and Outlook

Montauk Renewables provided its full-year 2025 outlook, expecting RNG revenues to range between $150 million and $170 million, and renewable electricity revenues to range between $17 million and $18 million. Analysts estimate the company's revenue growth to be around 15.7% for the next year. The company's guidance suggests a stable outlook, with expectations of continued growth in production.

Valuation Metrics

To understand what's priced into Montauk Renewables' stock, we can look at its valuation metrics. The company has a P/E Ratio of 86.79, indicating a relatively high valuation compared to its earnings. The P/S Ratio is 1.26, which is relatively low compared to its peers. Additionally, the EV/EBITDA ratio is 7.51, suggesting a moderate valuation. The company's ROE is 1.01%, and ROIC is 1.44%, indicating a relatively low return on equity and invested capital.

Expense Management

The company's G&A expenses were lower in Q3 2025 compared to the previous quarter, mainly due to the timing of professional fees. Kevin Van Asdalan explained that the variance is "mainly due to timing of professional fees, including audit fees and auditor fees, as the company prepares for its first fully integrated audit in 2026." The company doesn't expect a significant increase in operating expenses in the near future, except for the onboarding of the new Turkey Creek facility in 2026.

3. NewsRoom

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Comparing Montauk Renewables (NASDAQ:MNTK) & Gevo (NASDAQ:GEVO)

Nov -29

Source: defenseworld.net

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Montauk Renewables, Inc. (MNTK) Q3 2025 Earnings Call Transcript

Nov -06

Source: seekingalpha.com

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Montauk Renewables Announces Third Quarter 2025 Results

Nov -05

Source: globenewswire.com

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Montauk Renewables Is Not Risky Now, But Leverage Is Adding Up

Oct -23

Source: seekingalpha.com

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Montauk Renewables (NASDAQ:MNTK) Trading 4.8% Higher – What’s Next?

Oct -21

Source: defenseworld.net

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Montauk Renewables, Inc. (MNTK) Q2 2025 Earnings Call Transcript

Aug -07

Source: seekingalpha.com

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Montauk (MNTK) Q2 Revenue Rises 4%

Aug -07

Source: fool.com

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Montauk Renewables Announces Second Quarter 2025 Results

Aug -06

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.92%)

6. Segments

Renewable Natural Gas

Expected Growth: 10.93%

Montauk Renewables, Inc.'s 10.93% growth in Renewable Natural Gas is driven by increasing demand for low-carbon energy, government incentives for renewable energy adoption, and declining production costs. Additionally, the company's strategic partnerships and expanding distribution network have enabled it to capitalize on growing market opportunities.

Renewable Electricity Generation

Expected Growth: 10.88%

Montauk Renewables, Inc.'s 10.88% growth in renewable electricity generation is driven by increasing demand for clean energy, declining costs of renewable technologies, and favorable government policies and incentives. Additionally, the company's strategic expansion into new markets and successful project executions have contributed to its growth momentum.

7. Detailed Products

Renewable Natural Gas (RNG)

A clean and renewable energy source produced from organic waste, used as a substitute for fossil fuels in transportation and power generation.

Electricity Generation

Renewable energy generated from landfill gas, used to power homes, businesses, and industries.

Carbon Credits

Verified emission reductions generated from landfill gas capture and utilization projects, sold to companies to offset their greenhouse gas emissions.

Landfill Gas Capture

System design, installation, and operation services for capturing and utilizing landfill gas, reducing greenhouse gas emissions and generating renewable energy.

8. Montauk Renewables, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Montauk Renewables, Inc. is medium due to the availability of alternative renewable energy sources, but the company's focus on wind and solar energy provides some differentiation.

Bargaining Power Of Customers

The bargaining power of customers for Montauk Renewables, Inc. is low due to the company's strong brand reputation and the lack of alternative renewable energy providers in the region.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Montauk Renewables, Inc. is medium due to the company's dependence on a few key suppliers for wind turbines and solar panels, but the company's scale and reputation provide some negotiating power.

Threat Of New Entrants

The threat of new entrants for Montauk Renewables, Inc. is high due to the growing demand for renewable energy and the relatively low barriers to entry in the industry.

Intensity Of Rivalry

The intensity of rivalry for Montauk Renewables, Inc. is medium due to the presence of several established players in the renewable energy industry, but the company's focus on wind and solar energy provides some differentiation and reduces the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 20.35%
Debt Cost 3.95%
Equity Weight 79.65%
Equity Cost 1.92%
WACC 2.33%
Leverage 25.55%

11. Quality Control: Montauk Renewables, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Growth: 4.7

Quality: 5.3

Yield: 7.0

Momentum: 2.0

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Unitil

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Growth: 5.2

Quality: 5.8

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AES

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Value: 6.6

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Quality: 3.5

Yield: 8.0

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A-Score: 4.5/10

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Growth: 8.6

Quality: 5.1

Yield: 0.0

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Montauk Renewables

A-Score: 2.7/10

Value: 5.7

Growth: 5.2

Quality: 4.3

Yield: 0.0

Momentum: 0.0

Volatility: 1.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.71$

Current Price

1.71$

Potential

-0.00%

Expected Cash-Flows