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Ahead of Q2 Numbers, Insiders Are Buoyant about Ring Energy

Story Highlights

Ring Energy is all set to deliver second-quarter numbers today. Insiders as well as hedge funds are showing confidence in the stock already.

A major insider has just bought shares in oil and gas explorer and producer Ring Energy (REI), which is set to report second-quarter numbers after the market closes today.

Positive Insider Moves

Ahead of the results, our data indicates insiders have increased holdings in Ring by $1.4 million in the last three months. Moreover, William Kruse, who owns over a 10% stake in the company, acquired 507,214 shares yesterday at $2.67 per share.

Since January 2021, Kruse has bought REI shares seven times, generating an average return of 90.59%. Furthermore, yesterday’s informative Buy takes his holdings to $37.11 million.

REI’s Upcoming Q2

The company is expected to report earnings per share (EPS) of $0.25 for the second quarter, its third straight quarterly bottom-line expansion. In the year-ago period, it had delivered an EPS of $0.07 versus the Street’s expectations of $0.06.

Furthermore, Ring continues to benefit from the higher energy prices and has seen its revenue increase from $107.8 million in 2020 to $187.2 million in 2021. Concurrently, its bottom line, too, has expanded from $0.28 per share to $0.31 in 2021.

Additionally, its $465 million acquisition of Stronghold Energy from Warburg Pincus in July remains a key catalyst. The acquired operations in the Permian basin raised Ring’s proved reserves by over 80% while almost doubling its expected sales volume for Q4 2022.

Hedge Funds Remain Positive

Along with positive insiders, hedge funds, too, are lapping the stock up. Hedge funds have increased holdings in Ring by 43,100 shares in the last quarter. Notably, Andrew Law’s Caxton Associates has increased holdings in the stock by a massive 100%.

Closing Note

Ring continues to benefit from macro dynamics in the energy sector, and its recent Permian basin transaction puts it in a good position. Additionally, a beta of 0.59, a price-to-cash flow ratio of 3.90, and a price-to-sales ratio of 1.60 make the stock attractive at current levels.

Read full Disclosure

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