Breaking Down Ring Energy, Inc. (REI) Financial Health: Key Insights for Investors

Breaking Down Ring Energy, Inc. (REI) Financial Health: Key Insights for Investors

US | Energy | Oil & Gas Exploration & Production | AMEX

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Are you keeping a close watch on Ring Energy, Inc. (REI) and trying to gauge its financial stability? Did you know that Ring Energy's total debt stood at $385 million at the close of 2024, but they also had about $217 million in available liquidity? How might this impact their ability to invest in future growth or handle unexpected downturns? Despite a 7% dip in realized prices, the company still managed an adjusted EBITDA of $233.3 million. With a focus on maintaining capital discipline, Ring Energy generated an adjusted free cash flow of $43.6 million for the year. Keep reading to explore more about Ring Energy's financial decisions and what they could mean for investors like you.

Ring Energy, Inc. (REI) Revenue Analysis

Analyzing Ring Energy, Inc.'s (REI) revenue streams involves understanding where the company's money comes from, how quickly its revenue is growing, and how different parts of the business contribute to the overall financial picture. Let's delve into the specifics of REI's revenue composition and trends.

Breakdown of Primary Revenue Sources:

Ring Energy, Inc. primarily generates revenue through the sale of oil and natural gas. Revenue can be attributed to the specific geographical regions where REI operates, mainly the Permian Basin. Understanding the mix of oil versus natural gas revenue is crucial, as price fluctuations in these commodities can significantly impact REI's financial performance.

Year-over-Year Revenue Growth Rate:

To assess the health of REI's revenue, it's important to look at the year-over-year revenue growth rate. This involves comparing the revenue from one year to the previous year to determine the percentage increase or decrease. Examining historical trends over several years provides a clearer picture of REI's ability to consistently grow its revenue. Keep an eye out for any significant changes or patterns, such as periods of rapid growth or decline, which could be tied to factors like changes in oil prices, production levels, or acquisitions.

Contribution of Different Business Segments to Overall Revenue:

Analyzing the contributions of different business segments helps to identify which areas are driving revenue growth and which may be underperforming. For Ring Energy, Inc., this primarily involves assessing revenue generated from various fields and properties. Understanding these contributions aids in strategic decision-making and resource allocation.

Analysis of Any Significant Changes in Revenue Streams:

Significant changes in revenue streams can signal shifts in Ring Energy, Inc.'s business strategy or market conditions. These changes could include:

  • Increased revenue from a specific region due to new drilling activities.
  • Decreased revenue from another region due to divestiture of assets.
  • Changes in the mix of oil and gas revenue due to fluctuations in commodity prices.

Monitoring and understanding these shifts are essential for investors to gauge the company's adaptability and long-term prospects. For additional insights into the company's broader objectives, you may find this resource helpful: Mission Statement, Vision, & Core Values of Ring Energy, Inc. (REI).

Ring Energy, Inc. (REI) Profitability Metrics

Analyzing Ring Energy, Inc.'s financial health involves a detailed examination of its profitability metrics. This includes assessing gross profit, operating profit, and net profit margins to understand the company's efficiency in generating earnings. Evaluating trends in these metrics over time and comparing them against industry averages provides valuable insights into Ring Energy's performance and competitive positioning.

Here's a look at Ring Energy, Inc.'s profitability, based on available information:

  • Gross Profit Margin: In 2023, Ring Energy reported a gross profit of $275.94 million.
  • Operating Profit Margin: Ring Energy's operating income for 2023 was $101.15 million.
  • Net Profit Margin: The company's net income available to common shareholders for 2023 stood at $33.98 million.

To provide a clearer picture, here's a table summarizing Ring Energy's income statement data:

Metric 2023 (USD in Millions)
Revenue $434.74
Gross Profit $275.94
Operating Income $101.15
Net Income Available to Common Shareholders $33.98

Understanding Ring Energy's profitability also requires examining its operational efficiency. This involves analyzing cost management strategies and gross margin trends to identify areas of strength and potential improvement. By comparing Ring Energy's profitability ratios with those of its industry peers, investors can gain a more comprehensive understanding of the company's financial health and its ability to generate sustainable returns.

Further insights into Ring Energy, Inc.'s financial health can be found here: Breaking Down Ring Energy, Inc. (REI) Financial Health: Key Insights for Investors

Ring Energy, Inc. (REI) Debt vs. Equity Structure

Understanding how Ring Energy, Inc. (REI) finances its operations and growth is crucial for investors. This involves examining the company's debt levels, debt-to-equity ratio, and recent financing activities. Here's a breakdown of REI's debt versus equity structure:

As of December 31, 2023, Ring Energy's financial reports outline the company's approach to managing its debt and equity. Key details include:

  • Long-term Debt: Ring Energy had a long-term debt of $380.0 million outstanding.
  • Short-term Debt: The company's short-term debt, representing the current portion of long-term debt, was reported at $20.0 million.

The debt-to-equity ratio is a key metric for evaluating a company's financial leverage. A lower ratio generally indicates less risk, while a higher ratio suggests more aggressive financing. As of the end of 2023, Ring Energy's debt-to-equity ratio can be analyzed based on its total debt and shareholders' equity.

Recent activities provide insights into Ring Energy's financing strategies:

  • Credit Ratings: It is important to monitor any updates to Ring Energy's credit ratings as provided by rating agencies, which can influence borrowing costs and investor confidence.
  • Balancing Act: Ring Energy strategically uses both debt and equity to fund its operations. Monitoring the mix helps in understanding the company's financial risk profile and growth potential.

Here's a table summarizing Ring Energy's debt information as of December 31, 2023:

Category Amount (USD)
Long-Term Debt $380.0 million
Short-Term Debt $20.0 million

For further insights, explore: Breaking Down Ring Energy, Inc. (REI) Financial Health: Key Insights for Investors

Ring Energy, Inc. (REI) Liquidity and Solvency

Analyzing Ring Energy, Inc.'s (REI) liquidity and solvency involves examining key financial metrics and trends to assess its ability to meet short-term obligations and long-term financial stability. This assessment is crucial for investors to understand the company's financial health and potential risks.

Assessing Ring Energy, Inc.'s Liquidity:

Liquidity ratios provide insights into a company's ability to cover its short-term liabilities with its short-term assets. Here’s an overview of key liquidity measures for Ring Energy, Inc. (REI):

  • Current Ratio: The current ratio is calculated by dividing current assets by current liabilities. It indicates whether a company has enough short-term assets to cover its short-term liabilities.
  • Quick Ratio: The quick ratio, also known as the acid-test ratio, is a more conservative measure of liquidity. It excludes inventory from current assets, as inventory may not be easily convertible to cash.

Working Capital Trends:

Monitoring working capital trends helps in understanding the operational efficiency and short-term financial health of Ring Energy, Inc. (REI). Working capital is the difference between a company's current assets and current liabilities. Here's what to consider:

  • Positive Working Capital: Indicates that a company has enough short-term assets to cover its short-term liabilities.
  • Negative Working Capital: May indicate liquidity issues, where a company might struggle to meet its short-term obligations.

Cash Flow Statements Overview:

Cash flow statements provide a comprehensive view of all the cash inflows and outflows of Ring Energy, Inc. (REI), categorized into operating, investing, and financing activities. Analyzing these trends can reveal the company's financial stability and sustainability.

  • Operating Cash Flow: Cash generated from the company's core business activities. A positive trend indicates the company is generating sufficient cash from its operations.
  • Investing Cash Flow: Cash flow related to the purchase and sale of long-term assets.
  • Financing Cash Flow: Cash flow related to debt, equity, and dividends.

Potential Liquidity Concerns or Strengths:

Identifying potential liquidity concerns or strengths is crucial for assessing the overall financial risk of Ring Energy, Inc. (REI).

  • Liquidity Strengths: A high current ratio, quick ratio, and positive operating cash flow indicate strong liquidity.
  • Liquidity Concerns: Declining cash reserves, negative working capital, and reliance on short-term borrowing may raise concerns.

Understanding the investor profile can offer additional insights into the market's perception and confidence in the company's financial strategies. To delve deeper into who is investing and why, check out: Exploring Ring Energy, Inc. (REI) Investor Profile: Who’s Buying and Why?

Ring Energy, Inc. (REI) Valuation Analysis

Assessing whether Ring Energy, Inc. (REI) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. Let's delve into these aspects to provide a clearer picture for investors.

Price-to-Earnings (P/E), Price-to-Book (P/B), and Enterprise Value-to-EBITDA (EV/EBITDA) Ratios:

  • P/E Ratio: This ratio compares Ring Energy's stock price to its earnings per share (EPS). As of April 2025, recent data indicates a negative P/E ratio for Ring Energy due to negative earnings, suggesting caution.
  • P/B Ratio: The Price-to-Book ratio, which compares a company's market capitalization to its book value of equity, is another tool used to assess valuation.
  • EV/EBITDA: The Enterprise Value-to-EBITDA ratio is valuable for assessing overall company valuation, taking into account debt and operational performance.

Stock Price Trends Over the Last 12 Months (or Longer):

Analyzing Ring Energy's stock price trends provides insights into market sentiment and company performance. Over the past 12 months, Ring Energy's stock has shown volatility, influenced by oil price fluctuations and company-specific announcements. Investors should consider these trends in the context of broader market conditions and industry dynamics.

Dividend Yield and Payout Ratios (If Applicable):

As of April 2025, Ring Energy does not currently offer a dividend. Therefore, dividend yield and payout ratios are not applicable in this valuation analysis.

Analyst Consensus on Stock Valuation (Buy, Hold, or Sell):

Analyst ratings offer a consolidated view of professional opinions on Ring Energy's stock. The consensus leans towards a 'hold' rating, reflecting a cautious outlook. However, individual analysts may have varying price targets and recommendations based on their specific analyses. For further insights, refer to: Mission Statement, Vision, & Core Values of Ring Energy, Inc. (REI).

Below is a table summarizing key valuation metrics for Ring Energy, Inc. (REI):

Metric Value Analysis
P/E Ratio Negative Potentially overvalued due to losses
P/B Ratio Unavailable Requires further data
EV/EBITDA Unavailable Requires further data
Dividend Yield 0% Not applicable
Analyst Consensus Hold Cautious outlook

Valuation data can fluctuate and is time-sensitive. Always refer to the most recent financial data and consult with a financial professional before making investment decisions.

Ring Energy, Inc. (REI) Risk Factors

Understanding the risks associated with Ring Energy, Inc. (REI) is crucial for investors. These risks span from internal operational challenges to external market forces, all of which can significantly impact the company's financial health.

Here's an overview of the key risks:

  • Industry Competition: The oil and gas industry is highly competitive. Ring Energy, Inc. (REI) competes with numerous other companies, including major integrated oil companies, independent producers, and other industry participants. Increased competition can lead to lower prices and reduced profitability.
  • Regulatory Changes: Changes in environmental regulations, drilling permits, and other governmental policies can significantly affect Ring Energy, Inc. (REI)'s operations. Compliance with these regulations can increase costs and limit drilling activities.
  • Market Conditions: The prices of oil and natural gas are subject to significant volatility due to supply and demand, economic conditions, and geopolitical events. Lower commodity prices can reduce Ring Energy, Inc. (REI)'s revenues and cash flows.

Recent earnings reports and filings highlight several operational, financial, and strategic risks. These include:

  • Operational Risks: Drilling and production activities are subject to inherent risks, including well failures, equipment malfunctions, and accidents. These events can result in production delays, increased costs, and environmental liabilities.
  • Financial Risks: Ring Energy, Inc. (REI) relies on debt financing to fund its operations and acquisitions. High levels of debt can increase financial risk and limit the company's ability to invest in future growth.
  • Strategic Risks: The success of Ring Energy, Inc. (REI)'s growth strategy depends on its ability to identify and acquire new oil and gas properties. Failure to do so can limit the company's long-term growth potential.

While specific mitigation strategies may vary, Ring Energy, Inc. (REI) typically employs several common approaches to manage these risks:

  • Hedging: Using financial instruments to lock in future prices for oil and gas production, reducing exposure to commodity price volatility.
  • Insurance: Maintaining insurance coverage to protect against operational accidents, environmental liabilities, and other potential losses.
  • Diversification: Spreading investments across multiple projects and geographic areas to reduce the impact of any single event on the company's overall financial performance.

Investors should carefully consider these risks when evaluating Ring Energy, Inc. (REI). Understanding the potential challenges and mitigation strategies can help investors make more informed decisions.

For more insights into Ring Energy, Inc. (REI) investors, check out: Exploring Ring Energy, Inc. (REI) Investor Profile: Who’s Buying and Why?

Ring Energy, Inc. (REI) Growth Opportunities

Ring Energy, Inc. (REI) is strategically positioned for future growth through several key drivers. These include leveraging product innovations, expanding into new markets, and potentially pursuing strategic acquisitions. The company's ability to capitalize on these areas will be crucial for enhancing its financial performance and market position.

Future revenue growth projections and earnings estimates for Ring Energy, Inc. (REI) hinge on several factors, including oil price volatility, production efficiencies, and successful execution of strategic initiatives. Investors should closely monitor these elements to gauge the company's potential for meeting or exceeding financial targets.

Strategic initiatives and partnerships play a vital role in Ring Energy, Inc.'s (REI) growth trajectory. Collaborations with other industry players or innovative approaches to production and resource management could significantly drive future growth. Keeping an eye on these developments is essential for understanding the company's long-term prospects.

Ring Energy, Inc. (REI) possesses several competitive advantages that could position it favorably for growth. These may include:

  • Strategic Asset Base: High-quality acreage in the Permian Basin, known for its prolific oil production.
  • Operational Efficiency: Streamlined operations and cost-effective production methods.
  • Experienced Management Team: A leadership team with a proven track record in the oil and gas industry.
  • Financial Flexibility: Access to capital markets and a balanced approach to debt management.

These advantages enable Ring Energy, Inc. (REI) to effectively compete and capitalize on growth opportunities in the energy sector.

For more detailed insights into Ring Energy, Inc.'s (REI) financial health, you can refer to: Breaking Down Ring Energy, Inc. (REI) Financial Health: Key Insights for Investors

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