Mother Lode
3 months ago
"Source: shutterstock.com/Wojciech Wrzesien
Among the emerging names in the oil & gas exploration sector, Ring Energy (NYSE:REI) looks attractive. REI stock has been subdued in the last few quarters and is trading at a valuation gap. With business developments remaining positive, I expect a sharp rally from current levels of $1.65.
An important point to note is that Ring Energy commands a market valuation of $334 million. In comparison, the oil & gas company has proved reserves of 129.8 mmboe and has a PV10 of $1.65 billion. That puts into perspective the extent of undervaluation.
I also like the fact that Ring Energy has a good track record of production growth. Between 2018 and 2023, the company’s production has increased at a CAGR of 26%. That has been supported by the acquisition of oil & gas assets.
However, it’s equally important to mention that production growth has been associated with an upside in cash flows. For Q1 2024, Ring Energy reported an adjusted free cash flow of $15.6 million. On a year-on-year basis. FCF swelled by 48%. Therefore, with multiple positive business and financial metrics, REI stock is a likely value creator."
https://finance.yahoo.com/news/7-undervalued-oil-gas-stocks-171357772.html
littlejohn
1 year ago
Ruff time to report earnings in oil patch...
U.S. oil inventories have dove
downward over past month,,,
while U.S. oil exports accelerated,,,
while China is buying heavy due to
reopening their economy after two
years of shutins for citizens...
And oil price is Well below $100/bbl.
this year so far...
Keeping a cap on rig counts in play
with high drilling costs...
Ruff time to report earnings...
So we watch...LJ
littlejohn
1 year ago
1. no, 2. no, 3. no, 4.no, 5. yes,,,
5. yes, need firm to double check
company accounting...
If you didn't price a prior deal at
total value from start in past, then
why should you be allowed to
disperse more shares that way?...
So we watch...LJ
littlejohn
2 years ago
REI 10K showed that they finished paying
the 15 million owed to Stronghold
and the other 8 million, or so, held
in escrow was also paid per terms
in February, 2023...
So that lowered overall debt more...
Which makes me wonder why the
controlling shareholders would have
been selling out shares...
Stronghold should have made a deal
with a higher oily percentage company,
REI, to get better valuation on their
assets on a longer term basis...
Alas, the 10K filing has no description
on the Ownership positions to sway
either argument on the subject...
Which I find surprising...
So we watch...LJ