Notices that Keith Schaeffer - Oil & Gas Investments Bulletin added REI to his portfolio today.
Will be publishing a full report in a day or two.
Ring Energy - REI
Re: Ring Energy - REI
Keith is a sharp guy. I expect Ring Energy's daily production to double this year, with an exit rate over 9,000 BOE per day. Up from 2,981 BOE per day in Q1.
------------------------------
Ring Energy, Inc. (NYSE MKT: REI) (“Ring”)(“Company”) announced financial results for the first quarter ended March 31, 2017. For the three month period ended March 31, 2017, Ring had oil and gas revenues of $12,243,793 compared to $6,092,388 for the quarter ended March 31, 2016, and net income of $1,696,141, or $0.03 per diluted share, compared to a net loss of $15,275,044, or $0.50 per diluted share, which included a pre-tax non-cash impairment of $21,412,086 for the same period in 2016. Excluding the after tax impact of the impairment, the net loss per diluted share for the three month period ended March 31, 2016 would have been $0.06.
For the three months ended March 31, 2017, oil sales volume increased to 240,260 barrels, compared to 191,377 barrels for the same period in 2016, an 26% increase, and gas sales volume decreased to 168,349 MCF (thousand cubic feet), compared to 256,748 MCF for the same period in 2016, a 34% decrease. On a barrel of oil equivalent (“BOE”) basis for the three months ended March 31, 2017, production sales increased to 268,318 BOEs (2,981 BOEPD), compared to 234,168 BOEs for the same period in 2016, a 15% increase. The average commodity prices received by Ring were $48.69 per barrel of oil and $3.25 per MCF of natural gas for the quarter ended March 31, 2017, compared to $29.20 per barrel of oil and $1.97 per MCF of natural gas for the quarter ended March 31, 2016.
Lease operating expenses, including production taxes, for the three months ended March 31, 2017 were $12.26 per BOE, a 3% increase from the prior year. Depreciation, depletion and amortization costs, including accretion, decreased 10% to $13.46 per BOE. General and administrative costs, which included a $991,210 charge for stock based compensation, were $10.59 per BOE, a 12% increase.
Cash provided by operating activities, before changes in working capital, for the three months ended March 31, 2017 was $7,221,936 or $0.14 per fully diluted share (above my forecast), compared to $1,254,315, or $0.04 per fully diluted share for the same period in 2016. Earnings before interest, taxes, depletion and other non-cash items (“Adjusted EBITDA”) for the three months ended March 31, 2017 was $7,105,257, or $0.14 per fully diluted share, compared to $1,666,936, or $0.05 per fully diluted share for the same period in 2016. (See accompanying table for a reconciliation of net income to adjusted EBITDA).
There was no outstanding debt on the Company’s $500 million senior secured credit facility at March 31, 2017.
Ring’s Chief Executive Officer, Mr. Kelly Hoffman, stated, “2017 is off to a fast start. With the promising initial results from the first 10 horizontal wells we drilled on our Central Basin Platform (“CBP”) property, our enthusiasm has only increased. Our staff has amassed a premier acreage portfolio in what is arguably one of the best locations in the country. With the acquisition of the 33,000 acres in Gaines County completed, we now have over 600 net potential drilling locations. We continue to look for opportunities that complement our core assets. We are excited and expect this year to be an extraordinary time for the Company.”
------------------------------
Ring Energy, Inc. (NYSE MKT: REI) (“Ring”)(“Company”) announced financial results for the first quarter ended March 31, 2017. For the three month period ended March 31, 2017, Ring had oil and gas revenues of $12,243,793 compared to $6,092,388 for the quarter ended March 31, 2016, and net income of $1,696,141, or $0.03 per diluted share, compared to a net loss of $15,275,044, or $0.50 per diluted share, which included a pre-tax non-cash impairment of $21,412,086 for the same period in 2016. Excluding the after tax impact of the impairment, the net loss per diluted share for the three month period ended March 31, 2016 would have been $0.06.
For the three months ended March 31, 2017, oil sales volume increased to 240,260 barrels, compared to 191,377 barrels for the same period in 2016, an 26% increase, and gas sales volume decreased to 168,349 MCF (thousand cubic feet), compared to 256,748 MCF for the same period in 2016, a 34% decrease. On a barrel of oil equivalent (“BOE”) basis for the three months ended March 31, 2017, production sales increased to 268,318 BOEs (2,981 BOEPD), compared to 234,168 BOEs for the same period in 2016, a 15% increase. The average commodity prices received by Ring were $48.69 per barrel of oil and $3.25 per MCF of natural gas for the quarter ended March 31, 2017, compared to $29.20 per barrel of oil and $1.97 per MCF of natural gas for the quarter ended March 31, 2016.
Lease operating expenses, including production taxes, for the three months ended March 31, 2017 were $12.26 per BOE, a 3% increase from the prior year. Depreciation, depletion and amortization costs, including accretion, decreased 10% to $13.46 per BOE. General and administrative costs, which included a $991,210 charge for stock based compensation, were $10.59 per BOE, a 12% increase.
Cash provided by operating activities, before changes in working capital, for the three months ended March 31, 2017 was $7,221,936 or $0.14 per fully diluted share (above my forecast), compared to $1,254,315, or $0.04 per fully diluted share for the same period in 2016. Earnings before interest, taxes, depletion and other non-cash items (“Adjusted EBITDA”) for the three months ended March 31, 2017 was $7,105,257, or $0.14 per fully diluted share, compared to $1,666,936, or $0.05 per fully diluted share for the same period in 2016. (See accompanying table for a reconciliation of net income to adjusted EBITDA).
There was no outstanding debt on the Company’s $500 million senior secured credit facility at March 31, 2017.
Ring’s Chief Executive Officer, Mr. Kelly Hoffman, stated, “2017 is off to a fast start. With the promising initial results from the first 10 horizontal wells we drilled on our Central Basin Platform (“CBP”) property, our enthusiasm has only increased. Our staff has amassed a premier acreage portfolio in what is arguably one of the best locations in the country. With the acquisition of the 33,000 acres in Gaines County completed, we now have over 600 net potential drilling locations. We continue to look for opportunities that complement our core assets. We are excited and expect this year to be an extraordinary time for the Company.”
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
-
wilmawatts
- Posts: 685
- Joined: Fri Apr 01, 2011 10:12 am
Re: Ring Energy - REI
If you read the REI call transcript be sure you are belted in. The potential will knock you to the floor in a hurry.
Wow
Wow
Re: Ring Energy - REI
You pay me the BIG BUCKS to find incredible growth stories like Ring Energy. GREAT management team and an outstanding BOD.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
-
wilmawatts
- Posts: 685
- Joined: Fri Apr 01, 2011 10:12 am
Re: Ring Energy - REI
What is your target price Dan? Do you know Roth's target price?
-
wilmawatts
- Posts: 685
- Joined: Fri Apr 01, 2011 10:12 am
Re: Ring Energy - REI
In the Ring Energy (REI) Q1 earnings call this week an analyst noted “the range you’ve given in the rate of return is obviously phenomenal” referring to the company’s San Andres play on the Central Basin Platform in West Texas. Management noted IRR’s of between 70% (worst wells) to over 500% (best wells) return on the $2.4 million mile long horizontals at $45 bbl oil.
13 of the 22 scheduled wells in the San Andres have been drilled, and if the rig is extended or a second rig added this number could jump to 35 to 45 for the year. The company has added aggressively to the acreage position. In addition to the Central Basin Platform San Andres play they have a Delaware Basin play and will drill 8 vertical wells in that prospect.
Analysts that I follow forecast that production will ramp from 2,901 BOE per day in Q1 to 9,000 BOE per day at year end without the rig extension or additional rig. Rare to find such explosive growth, and IRR’s. And the valuation looks very attractive at the current stock price.
Call transcript is at:
https://seekingalpha.com/a/2f9w9?p=djnw
13 of the 22 scheduled wells in the San Andres have been drilled, and if the rig is extended or a second rig added this number could jump to 35 to 45 for the year. The company has added aggressively to the acreage position. In addition to the Central Basin Platform San Andres play they have a Delaware Basin play and will drill 8 vertical wells in that prospect.
Analysts that I follow forecast that production will ramp from 2,901 BOE per day in Q1 to 9,000 BOE per day at year end without the rig extension or additional rig. Rare to find such explosive growth, and IRR’s. And the valuation looks very attractive at the current stock price.
Call transcript is at:
https://seekingalpha.com/a/2f9w9?p=djnw
Re: Ring Energy - REI
Since Ring announced Q1 results, the First Call target price has increased almost $2 to $18.75. Roth Capital's target price is $18.50.
John White at Roth Capital is friend. He meets with Ring's management on a regular basis and he has a detailed forecast model for the company.
John White at Roth Capital is friend. He meets with Ring's management on a regular basis and he has a detailed forecast model for the company.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group