RING ENERGY INC (REI) Stock Fundamental Analysis
NYSEARCA:REI - NYSE Arca - US76680V1089 - Common Stock - Currency: USD
REI gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 213 industry peers in the Oil, Gas & Consumable Fuels industry. While REI is still in line with the averages on profitability rating, there are concerns on its financial health. REI scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
REI had positive earnings in the past year.
In the past year REI had a positive cash flow from operations.
REI had positive earnings in 4 of the past 5 years.
In the past 5 years REI always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 4.79%, REI perfoms like the industry average, outperforming 54.93% of the companies in the same industry.
REI has a Return On Equity (7.86%) which is in line with its industry peers.
Looking at the Return On Invested Capital, with a value of 9.00%, REI is in the better half of the industry, outperforming 70.89% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for REI is significantly below the industry average of 25.69%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | 7.86% | ||
| ROIC | 9% |
ROA(3y)7.78%
ROA(5y)-2.88%
ROE(3y)14.05%
ROE(5y)-8.54%
ROIC(3y)11.4%
ROIC(5y)9.87%
1.3 Margins
REI has a better Profit Margin (18.42%) than 69.48% of its industry peers.
In the last couple of years the Profit Margin of REI has grown nicely.
REI has a Operating Margin of 36.28%. This is in the better half of the industry: REI outperforms 78.40% of its industry peers.
REI's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 93.26%, REI belongs to the best of the industry, outperforming 98.12% of the companies in the same industry.
In the last couple of years the Gross Margin of REI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.28% | ||
| PM (TTM) | 18.42% | ||
| GM | 93.26% |
OM growth 3Y-9.4%
OM growth 5Y2.02%
PM growth 3Y121.59%
PM growth 5Y4.09%
GM growth 3Y0.46%
GM growth 5Y5.74%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), REI is creating some value.
The number of shares outstanding for REI has been increased compared to 1 year ago.
The number of shares outstanding for REI has been increased compared to 5 years ago.
Compared to 1 year ago, REI has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.78, we must say that REI is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of REI (0.78) is comparable to the rest of the industry.
REI has a debt to FCF ratio of 10.20. This is a negative value and a sign of low solvency as REI would need 10.20 years to pay back of all of its debts.
REI's Debt to FCF ratio of 10.20 is in line compared to the rest of the industry. REI outperforms 50.70% of its industry peers.
REI has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.45, REI is in line with its industry, outperforming 51.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 10.2 | ||
| Altman-Z | 0.78 |
ROIC/WACC0.84
WACC10.73%
2.3 Liquidity
A Current Ratio of 0.48 indicates that REI may have some problems paying its short term obligations.
With a Current ratio value of 0.48, REI is not doing good in the industry: 86.39% of the companies in the same industry are doing better.
A Quick Ratio of 0.44 indicates that REI may have some problems paying its short term obligations.
The Quick ratio of REI (0.44) is worse than 84.98% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.48 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
The earnings per share for REI have decreased strongly by -32.69% in the last year.
The earnings per share for REI have been decreasing by -11.37% on average. This is quite bad
REI shows a small growth in Revenue. In the last year, the Revenue has grown by 1.46%.
The Revenue has been growing by 13.36% on average over the past years. This is quite good.
EPS 1Y (TTM)-32.69%
EPS 3Y4.13%
EPS 5Y-11.37%
EPS Q2Q%-45.45%
Revenue 1Y (TTM)1.46%
Revenue growth 3Y23.12%
Revenue growth 5Y13.36%
Sales Q2Q%-16.51%
3.2 Future
The Earnings Per Share is expected to grow by 26.44% on average over the next years. This is a very strong growth
REI is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.67% yearly.
EPS Next Y18.31%
EPS Next 2Y26.44%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-3.11%
Revenue Next 2Y6.67%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 2.43, which indicates a rather cheap valuation of REI.
Based on the Price/Earnings ratio, REI is valued cheaply inside the industry as 98.59% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of REI to the average of the S&P500 Index (23.99), we can say REI is valued rather cheaply.
The Price/Forward Earnings ratio is 2.05, which indicates a rather cheap valuation of REI.
98.59% of the companies in the same industry are more expensive than REI, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 20.35. REI is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 2.43 | ||
| Fwd PE | 2.05 |
4.2 Price Multiples
REI's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. REI is cheaper than 89.67% of the companies in the same industry.
89.67% of the companies in the same industry are more expensive than REI, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.63 | ||
| EV/EBITDA | 2.43 |
4.3 Compensation for Growth
REI's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
REI has a very decent profitability rating, which may justify a higher PE ratio.
REI's earnings are expected to grow with 26.44% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.13
PEG (5Y)N/A
EPS Next 2Y26.44%
EPS Next 3YN/A
5. Dividend
5.1 Amount
REI does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
0.8501
-0.01 (-1.15%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners33.67%
Inst Owner Change-0.41%
Ins Owners10.28%
Ins Owner Change5.99%
Market Cap175.55M
Analysts46.67
Price Target3.54 (316.42%)
Short Float %7.39%
Short Ratio5.34
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.97%
Min EPS beat(2)-6.2%
Max EPS beat(2)-3.74%
EPS beat(4)2
Avg EPS beat(4)-1.03%
Min EPS beat(4)-6.2%
Max EPS beat(4)4.52%
EPS beat(8)4
Avg EPS beat(8)1.85%
EPS beat(12)5
Avg EPS beat(12)-1.01%
EPS beat(16)8
Avg EPS beat(16)5.11%
Revenue beat(2)1
Avg Revenue beat(2)-0.01%
Min Revenue beat(2)-1.89%
Max Revenue beat(2)1.87%
Revenue beat(4)2
Avg Revenue beat(4)0.56%
Min Revenue beat(4)-1.89%
Max Revenue beat(4)2.64%
Revenue beat(8)4
Avg Revenue beat(8)-1.29%
Revenue beat(12)8
Avg Revenue beat(12)5.88%
Revenue beat(16)12
Avg Revenue beat(16)8.51%
PT rev (1m)26.18%
PT rev (3m)15.67%
EPS NQ rev (1m)10.09%
EPS NQ rev (3m)-25.47%
EPS NY rev (1m)23.49%
EPS NY rev (3m)7.47%
Revenue NQ rev (1m)-2.54%
Revenue NQ rev (3m)-9.25%
Revenue NY rev (1m)-7.64%
Revenue NY rev (3m)-2.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 2.43 | ||
| Fwd PE | 2.05 | ||
| P/S | 0.48 | ||
| P/FCF | 4.63 | ||
| P/OCF | 0.9 | ||
| P/B | 0.2 | ||
| P/tB | 0.2 | ||
| EV/EBITDA | 2.43 |
EPS(TTM)0.35
EY41.17%
EPS(NY)0.41
Fwd EY48.71%
FCF(TTM)0.18
FCFY21.61%
OCF(TTM)0.94
OCFY110.75%
SpS1.77
BVpS4.16
TBVpS4.16
PEG (NY)0.13
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | 7.86% | ||
| ROCE | 10.2% | ||
| ROIC | 9% | ||
| ROICexc | 9.02% | ||
| ROICexgc | 9.02% | ||
| OM | 36.28% | ||
| PM (TTM) | 18.42% | ||
| GM | 93.26% | ||
| FCFM | 10.36% |
ROA(3y)7.78%
ROA(5y)-2.88%
ROE(3y)14.05%
ROE(5y)-8.54%
ROIC(3y)11.4%
ROIC(5y)9.87%
ROICexc(3y)11.42%
ROICexc(5y)9.9%
ROICexgc(3y)11.42%
ROICexgc(5y)9.9%
ROCE(3y)12.92%
ROCE(5y)11.18%
ROICexcg growth 3Y-13.56%
ROICexcg growth 5Y7.52%
ROICexc growth 3Y-13.56%
ROICexc growth 5Y7.52%
OM growth 3Y-9.4%
OM growth 5Y2.02%
PM growth 3Y121.59%
PM growth 5Y4.09%
GM growth 3Y0.46%
GM growth 5Y5.74%
F-Score5
Asset Turnover0.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 10.2 | ||
| Debt/EBITDA | 1.67 | ||
| Cap/Depr | 158.54% | ||
| Cap/Sales | 42.72% | ||
| Interest Coverage | 3.39 | ||
| Cash Conversion | 83.95% | ||
| Profit Quality | 56.23% | ||
| Current Ratio | 0.48 | ||
| Quick Ratio | 0.44 | ||
| Altman-Z | 0.78 |
F-Score5
WACC10.73%
ROIC/WACC0.84
Cap/Depr(3y)189.7%
Cap/Depr(5y)162.85%
Cap/Sales(3y)41.16%
Cap/Sales(5y)37.88%
Profit Quality(3y)48.21%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-32.69%
EPS 3Y4.13%
EPS 5Y-11.37%
EPS Q2Q%-45.45%
EPS Next Y18.31%
EPS Next 2Y26.44%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)1.46%
Revenue growth 3Y23.12%
Revenue growth 5Y13.36%
Sales Q2Q%-16.51%
Revenue Next Year-3.11%
Revenue Next 2Y6.67%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-8.84%
EBIT growth 3Y11.55%
EBIT growth 5Y15.65%
EBIT Next Year69%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-11.68%
FCF growth 3Y24.85%
FCF growth 5YN/A
OCF growth 1Y-1.89%
OCF growth 3Y38.79%
OCF growth 5Y12.77%