Riley Exploration Permian (REPX) Valuation Update - Mar 20

[dan_s]

I have finished my review of the updated profile on REPX, which will be posted to the EPG website this afternoon.

TipRanks: "On March 11th Truist Financial analyst Neal Dingmann maintained a Buy rating on Riley Exploration Permian (REPX) keeping his price target at $53.00."

My valuation of $50/share is based on the midpoint of the Company's guidance for 2024 and WTI oil averaging $80/bbl for the year. Over 95% of Riley's revenues come from oil sales, 4% from NGL sales and less than 1% from natural gas sales.

My valuation is just 4X annualized operating cash flow per share, which is a low multiple for a company with a strong balance sheet, lots of Running Room in the Permian Basin, double digit organic production growth locked in and enough free cash flow to pay a nice dividend.

At the time of this post, REPX was trading at $30.07.

PLUS: They have a CO2 Flood Pilot Project underway that, if successful, could significantly increase their recoverable reserves in their core area in Yoakum County, Texas.