MNR, Mach Natural Resources LP Common

Will it survive?

• Can it pay its interest? 3.4×
  Adequate
  Operating income $245M ÷ interest expense $72M
  What this means

  Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.

• How heavy is the debt, net of cash? $1.1B · 4.5× operating profit
  Heavy net debt
  Cash $43M − debt $1.1B
  What this means

  Netting $43M of cash and short-term investments against $1.1B of debt leaves $1.1B owed, about 4.5× a year's operating profit (4.7× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.

• How long is cash tied up? —
  Not enough data
  What this means

  The filing data didn't include the inputs for this check.

Is it a good business?

• Return on invested capital —
  Not enough data
  Industry peers: median 8%
  What this means

  The filing data didn't include the inputs for this check.

• Owner-earnings margin 41%
  High through the cycle
  5-yr median margin, range 21%–50%; latest $245M = operating cash $507M − maintenance capex $262M
  Industry peers: median 19%
  What this means

  What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 21% of revenue this year, a 41% median across 5 years. Treating stock comp as the real expense it is (less $9M of SBC) leaves $235M.

• Are earnings backed by cash? 3.55×
  Cash-backed
  Cash from ops $507M ÷ net income $143M
  What this means

  How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

• Where do the earnings go? —
  Not enough data
  What this means

  The filing data didn't include the inputs for this check.

• Investing or harvesting? 0.90×
  Maintaining
  Capex $262M ÷ depreciation $293M
  What this means

  Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

• Adequate size Near
  Revenue ≥ $2B · $1.2B
  What this means

  Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.

• Strong liquidity Miss
  Current ratio ≥ 2× · 1.05×
  What this means

  Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.

• Conservative debt Miss
  Debt ≤ working capital · $1.1B vs $18M WC
  What this means

  Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.

• Earnings stability Pass
  A profit every year (5-yr record) · no losses
  What this means

  Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.

• Dividend record Miss
  Uninterrupted dividends · none paid
  What this means

  An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.

• Moderate price —
  P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
  What this means

  Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $0.79/share (latest year $0.85), the averaged base the calculator's gate runs on. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2021–2025

Whether the record’s returns held, and what the capital reinvested earned.

• Profitable years 5 of 5
  What this means

  Never lost money over the record, the earnings stability Graham insisted on.

• Operating margin 48% → 25% (2-yr avg ends)
  What this means

  Through the cycle the operating margin slipped — about 48% early to 25% lately, median 40% — competition or costs are biting in.

• Owner earnings growth −4%/yr
  What this means

  Owner earnings shrank about 4% a year over the record.

• Worst year 2025 · 20.8% op. margin
  What this means

  Stayed profitable even in its hardest year, the resilience that survives recessions.

• Share count +8.5%/yr
  What this means

  The share count is rising, dilution works against you on a per-share basis.