Ring Energy (REI, Financial) recently reported that its first quarter of 2025 operations exceeded expectations, with oil sales volumes surpassing the company's guidance. The company produced over 12,000 barrels of oil per day, significantly outperforming the higher end of its forecast. In terms of oil equivalent, Ring Energy recorded a production of more than 18,300 barrels per day, beating the midpoint of its previous estimates.
This production success was largely attributed to the effectiveness of Ring Energy's drilling initiatives, with seven horizontal and three vertical wells exceeding pre-drill estimates. Furthermore, the company finalized the acquisition of the Central Basin Platform assets from Lime Rock Resources IV, LP on March 31, 2025. This acquisition is expected to provide substantial cash flow benefits, owing to the assets' long-lived and oil-weighted nature, which are noted for their shallow decline rates.
Additionally, Ring Energy reported operational synergies, achieving a reduction in lease operating expenses by over 5%. During the initial weeks following the acquisition, production was higher than anticipated, averaging over 2,500 barrels of oil equivalent per day, surpassing expectations by more than 200 Boe/d.
To manage market risks, Ring Energy has secured hedges for over 6,300 barrels of oil per day, ensuring a weighted average downside protection price of $64.44 per barrel for the rest of 2025. This strategic move provides the company with a financial cushion against potential market volatility.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 1 analysts, the average target price for Ring Energy Inc (REI, Financial) is $3.00 with a high estimate of $3.00 and a low estimate of $3.00. The average target implies an upside of 258.77% from the current price of $0.84. More detailed estimate data can be found on the Ring Energy Inc (REI) Forecast page.
Based on the consensus recommendation from 2 brokerage firms, Ring Energy Inc's (REI, Financial) average brokerage recommendation is currently 3.0, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Ring Energy Inc (REI, Financial) in one year is $1.80, suggesting a upside of 115.26% from the current price of $0.8362. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Ring Energy Inc (REI) Summary page.
