This stock is a bargain! Annual P/E of 3 and probably lower!Earnings per share were 4 cents in Q1. Annually that will be 16 cents when WTI was at $94 on average in Q1. 16 cents is a P/E close to 3 (48 cents stock price). Moreover, Vital Energy earnings go to cash and short-term investments so the cashflows follow the earnings.
However, with WTI at $115 I think a P/E of 2 is more reasonable assumption. Here is why:
60K BOE production in Q1 * $21 higher WTI is $1.3 Million in extra revenues with the same production levels. All expenses are covered and how much can operating expenses really increase, being 13% of the Q1 revenues?
1.3 Million can go lower to 1.1 - 1.2 Million for profits. Still that is 30% of the Q1 earnings!
That is almost 30% of the operating profits that revenues will increase when WTI is at average $115 with the same production.
Shares outstanding were in Q1 82 mln, so that will be 1.5 cents extra profits -> 6 cents annually!
Together with the 16 cents based on Q1 that is 22 cents profits assumed annually with these oil prices and Q1 production.