Rodman & Renshaw Starts Ring Energy, Inc. (REI) at Buy
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Rodman & Renshaw initiated coverage on Ring Energy, Inc. (NYSE: REI) with a Buy rating and a price target of $15. Analyst Noel Parks sees large upside potential.
"Our target is based on our risked net asset valuation (RNAV) for the company's proved and potential reserves. The upside implied by our target represents our risk-weighted model of future reserve growth, giving credit for Ring’s portfolio of sizable, emerging crude oil development plays," said Parks.
Discussing valuation, the analyst said, " On an EV/ boe basis, REI trades at a wide discount to the peers, probably because of the misconception that its conventional-only targets lack sizable upside, since the Basin’s unconventional plays are dominating investors’ interest. REI is at $18.00/boe vs. $34.39/boe for its pureplay Permian peers."
Shares of Ring Energy, Inc. closed at $10.16 yesterday.
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Related EntitiesRodman & Renshaw, Crude Oil
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