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What You Need To Know About The Ring Energy, Inc. (NYSEMKT:REI) Analyst Downgrade Today

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Simply Wall St
·2 min read
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One thing we could say about the analysts on Ring Energy, Inc. (NYSEMKT:REI) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the downgrade, the most recent consensus for Ring Energy from its four analysts is for revenues of US$128m in 2021 which, if met, would be a meaningful 18% increase on its sales over the past 12 months. Before the latest update, the analysts were foreseeing US$142m of revenue in 2021. The consensus view seems to have become more pessimistic on Ring Energy, noting the measurable cut to revenue estimates in this update.

View our latest analysis for Ring Energy


Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Ring Energy's revenue growth is expected to slow, with the forecast 18% annualised growth rate until the end of 2021 being well below the historical 34% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.1% annually. Even after the forecast slowdown in growth, it seems obvious that Ring Energy is also expected to grow faster than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Ring Energy this year. Analysts also expect revenues to grow faster than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Ring Energy going forwards.

Need some more information? We have estimates for Ring Energy from its four analysts out until 2022, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.