NEW YORK (TheStreet) -- Synergy Resources
(SYRG - Get Report) shares are up 8.3% to $12.50 in trading on Thursday.
The uptick follows the company's announcement that its mid-year proved reserves increased by 43%.
The PV10 value of the proved reserves increased to $326 million from $236 million.
"The increase in our reserves is largely a result of the success of our operated horizontal drilling program with our first 11 horizontal wells being included as proved developed producing assets," said CEO William E. Scaff.
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TheStreet Ratings team rates SYNERGY RESOURCES CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:"We rate SYNERGY RESOURCES CORP (SYRG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, compelling growth in net income, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- SYRG's very impressive revenue growth greatly exceeded the industry average of 7.6%. Since the same quarter one year prior, revenues leaped by 110.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- SYRG's debt-to-equity ratio is very low at 0.15 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, SYRG has a quick ratio of 1.73, which demonstrates the ability of the company to cover short-term liquidity needs.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 88.9% when compared to the same quarter one year prior, rising from $2.73 million to $5.16 million.
- Net operating cash flow has increased to $18.44 million or 23.71% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -22.97%.
- The gross profit margin for SYNERGY RESOURCES CORP is currently very high, coming in at 82.36%. Regardless of SYRG's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SYRG's net profit margin of 22.41% significantly outperformed against the industry.
- You can view the full analysis from the report here: SYRG Ratings Report