Piper Sandler has started coverage of Ranger Energy (RNGR, Financial) with a Neutral stance and has assigned a price target of $13. The firm is examining 13 small to mid-sized oilfield services companies and notes that current conditions for U.S. land operations are difficult. This is attributed to oil prices continuing to linger below $70 per barrel due to tariffs and increased production. The analyst forecasts a "persistent negative rate-of-change environment" throughout 2025, predicting a decrease in the U.S. land rig count to 500 from the current 522. This decline is expected to impact fracturing activity and the pricing of proppants, according to the research note provided to investors.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 2 analysts, the average target price for Ranger Energy Services Inc (RNGR, Financial) is $15.25 with a high estimate of $18.00 and a low estimate of $12.50. The average target implies an upside of 24.80% from the current price of $12.22. More detailed estimate data can be found on the Ranger Energy Services Inc (RNGR) Forecast page.
Based on the consensus recommendation from 2 brokerage firms, Ranger Energy Services Inc's (RNGR, Financial) average brokerage recommendation is currently 2.5, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
RNGR Key Business Developments
Release Date: April 30, 2025
- Revenue: $135.2 million for Q1 2025, down from $143.1 million in Q4 2024.
- Adjusted EBITDA: $15.5 million, a 42% increase year-over-year.
- Adjusted EBITDA Margin: 11.4%, a significant improvement over the prior year.
- Free Cash Flow: $3.4 million or $0.15 per share.
- High Spec Rigs Revenue: $87.5 million with adjusted EBITDA of $17.4 million, up 28% year-over-year.
- Ancillary Services Revenue: $30.5 million, up 25% from Q1 2024.
- Wireline Revenue: $17.2 million, down 48% year-over-year, with an EBITDA loss of $2.3 million.
- Liquidity: $104.4 million, including $64.1 million from a revolving credit facility and $40.3 million in cash.
- Capital Expenditure: $7.2 million in Q1, focused on modernizing the rig fleet.
- Dividend Increase: 20% increase to $0.06 per share.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ranger Energy Services Inc (RNGR, Financial) reported significant year-over-year improvements in Adjusted EBITDA and margins, driven by the strength of their high specification rigs business.
- The company achieved revenue of $135.2 million and Adjusted EBITDA of $15.5 million, with a margin of 11.4%, marking a substantial improvement over the previous year.
- Ranger Energy Services Inc (RNGR) has a strong balance sheet with zero long-term debt, $104.4 million in liquidity, and $40 million in cash on hand.
- The company increased its dividend by 20% to $0.06 per share, demonstrating a commitment to shareholder returns.
- Ranger Energy Services Inc (RNGR) continues to benefit from its production-oriented focus, which provides resilience during market turbulence and aligns with the operational expenditure budgets of its customers.
Negative Points
- The wireline segment reported negative Adjusted EBITDA of $2.3 million due to severe weather impacts and stagnation in completion activity.
- Revenue for the first quarter was slightly down from the previous quarter, affected by unusually strong winter weather.
- Margins in the high specification rigs segment compressed slightly due to elevated first-quarter costs, such as labor carrying costs during winter.
- The company faces challenges in the wireline segment, with efforts to move it into positive territory amid a challenging market environment.
- Ranger Energy Services Inc (RNGR) acknowledges the uncertainty in the macroeconomic environment, which could impact future business operations and growth opportunities.
