Price Forecast:

Bullish Case: Ring Energy may benefit from rising oil prices and improved operational efficiencies, potentially leading to higher profitability and recovering stock performance, supported by significant asset acquisitions.

Bearish Case: Liquidity issues and rising interest expenses persist, compounded by a bearish market sentiment and potential volatility in oil prices, suggesting downward pressure on REI's stock price.

Potential Outcomes:

• 35% - Increased profitability due to operational efficiencies.
• 30% - Ongoing liquidity problems impact growth.
• 20% - Oil price fluctuations negatively affect revenue.
• 15% - Market volatility exacerbates stock price decline.

Trading Oracle: Consider a short-term credit spread strategy by selling December $1.50 puts and buying $1.00 puts, capitalizing on high implied volatility while mitigating downside risk. This position provides a profitable edge if REI maintains price stability through late 2024, aligning with historical support levels and possible recovery scenarios.

November 24, 2024