Western Energy Services (WRG) AI Stock Analysis

• Market Cap: C$71.75M
• Dividend Yield: N/A
• Average Volume (3M): 477.00
• Price to Earnings (P/E): ―
• Beta (1Y): -0.09
• Revenue Growth: 6.43%
• EPS Growth: 35.87%
• Country: CA
• Employees: 615
• Sector: Energy
• Sector Strength: 55
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.19
• Shares Outstanding: 33,843,020
• 10 Day Avg. Volume: 710
• 30 Day Avg. Volume: 477
• PEG Ratio: -0.03
• Price to Book (P/B): 0.27
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -14.06
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 53 Neutral
• Price Target: C$2.00 ▼(-4.76%Downside)

Western Energy Services' stock score is primarily impacted by its financial performance challenges, particularly profitability issues. Technical analysis also suggests a lack of strong momentum. While the company has a stable balance sheet and resilience in cash flow, its valuation remains unattractive due to negative earnings. The positive corporate events provide some support, but overall, significant improvement in profitability and market sentiment is needed to enhance the stock's score.

Western Energy Services Business Overview & Revenue Model

Company Description

Western Energy Services Corp. operates as an oilfield service company in Canada and the United States. It operates through Contract Drilling and Production Services segments. The Contract Drilling segment provides contract drilling services using drilling rigs and auxiliary equipment. The Production Services segment offers well servicing rig and related equipment, as well as oilfield rental equipment services to other oilfield service companies. The company owns and operates 57 drilling rigs; and 63 service rigs. It serves crude oil and natural gas exploration and production companies. The company was incorporated in 2013 and is headquartered in Calgary, Canada.

How the Company Makes Money

Western Energy Services makes money through multiple revenue streams primarily driven by its service offerings in the oil and gas industry. The company generates revenue by providing contract drilling services, which involve the use of their drilling rigs to assist exploration and production companies in extracting oil and gas. Another significant revenue stream comes from well servicing, where WRG offers maintenance and intervention services to ensure optimal well performance and longevity. Additionally, WRG earns income through the rental of specialized oilfield equipment to its clients. The company's earnings are influenced by factors such as the demand for oil and gas, global energy prices, and its ability to maintain strategic partnerships with major industry players.

Western Energy Services Financial Statement Overview

Summary

Western Energy Services shows resilience in cash flow and a stable balance sheet, but faces profitability challenges. The company has improved operational efficiency slightly, yet persistent net losses affect overall financial health.

Income Statement

Western Energy Services shows mixed results with a modest revenue growth rate of 3.2% and improving gross profit margin at 68.6% in TTM. However, persistent net losses and a negative net profit margin of -2.8% indicate profitability challenges. The EBIT margin improved slightly to 0.5% from the previous year's 0.2%, signifying slight operational efficiency gains, yet the company remains unprofitable.

Balance Sheet

The company exhibits a stable balance sheet with a debt-to-equity ratio of 0.37, lower than industry norms, suggesting a conservative leverage approach. The equity ratio stands at 67.3%, indicating a solid equity base. However, the return on equity is negative due to net losses, reflecting challenges in delivering shareholder value.

Cash Flow

Cash flow analysis reveals positive trends, with operating cash flow consistently exceeding net income, evidenced by a strong operating cash flow to net income ratio of -6.48. Free cash flow declined by 33.6% in TTM but remains positive, ensuring liquidity. The free cash flow to net income ratio is -2.62, indicating some resilience in cash flow generation despite net losses.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
230.11M	223.08M	233.45M	200.34M	131.68M	103.68M
	Gross Profit
157.80M	182.03M	21.82M	160.25M	89.65M	55.42M
	EBIT
1.08M	377.00K	2.81M	-2.25M	-19.41M	-28.78M
	EBITDA
42.64M	42.65M	45.34M	37.94M	22.43M	10.32M
	Net Income Common Stockholders
-6.39M	-7.16M	-7.21M	29.00M	-35.81M	-41.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.76M	3.79M	6.25M	8.88M	7.48M	19.32M
	Total Assets
438.23M	430.98M	442.93M	475.71M	456.00M	495.63M
	Total Debt
108.27M	98.75M	115.22M	131.69M	240.42M	241.99M
	Net Debt
104.51M	94.96M	109.29M	122.81M	232.94M	222.67M
	Total Liabilities
141.09M	135.13M	147.27M	173.18M	269.50M	273.15M
	Stockholders Equity
294.88M	293.62M	293.37M	300.59M	184.51M	220.80M
Cash Flow		Free Cash Flow
16.71M	25.19M	28.73M	-5.69M	9.77M	24.93M
	Operating Cash Flow
41.39M	46.80M	51.35M	28.54M	16.63M	27.72M
	Investing Cash Flow
-23.42M	-21.91M	-25.45M	-28.95M	-5.69M	-3.01M
	Financing Cash Flow
-17.63M	-27.03M	-28.85M	1.44M	-22.79M	-9.41M

Western Energy Services Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.10
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:WRG, the sentiment is Negative. The current price of 2.1 is below the 20-day moving average (MA) of 2.13, below the 50-day MA of 2.13, and below the 200-day MA of 2.50, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 47.67 is Neutral, neither overbought nor oversold. The STOCH value of 46.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:WRG.

Western Energy Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PHX	86 Outperform	C$384.98M	6.82	25.15%	9.47%	4.69%	-34.62%
AKT.A	77 Outperform	C$90.00M	4.78	11.11%	―	2.57%	63.53%
SDI	62 Neutral	C$24.99M	16.07	1.91%	―	-11.14%	-84.33%
ESI	58 Neutral	C$448.82M	14.37	-1.17%	―	-2.85%	-144.20%
Sector *	58 Neutral	$7.47B	3.50	-4.45%	10.05%	0.81%	-49.42%
WRG	53 Neutral	C$71.75M	―	-2.16%	―	6.43%	35.87%
AKT.B		C$90.38M	4.53	11.11%	―	―	―

Western Energy Services Corporate Events

Western Energy Services Appoints Gavin Lane as CEO

Western Energy Services Corp. has appointed Gavin Lane as the new President and CEO, following his interim role since January 31, 2025, after Alex MacAusland’s retirement. The decision comes after a comprehensive evaluation and external search, with the Board expressing confidence in Lane’s leadership to advance the company’s operations, safety processes, earning power, and culture. Chantel Calancia will continue as Interim CFO while a search for a permanent CFO is conducted.

Western Energy Services Corp. Announces 2025 Director Election Results

Western Energy Services Corp. announced the results of its 2025 director elections, with six nominees elected to the board with overwhelming support. This election is significant for the company as it ensures continuity in leadership, which is crucial for maintaining its strong position in the energy services industry and potentially influencing its strategic direction.

Western Energy Services Reports Q1 2025 Financial Results with Revenue Growth

Western Energy Services Corp. reported a revenue increase of 11% to $69 million in the first quarter of 2025, driven by higher contract drilling revenue in Canada, despite a decline in production services revenue. The company faced a decrease in Adjusted EBITDA by 8% due to one-time reorganization costs, although net income rose to $2.4 million, benefiting from reduced expenses in other areas. Operationally, the company saw a significant increase in drilling rig utilization in Canada, while the U.S. market remained stable with low activity. The extension of the maturity date for its Second Lien Facility indicates a strategic financial move, potentially impacting future liquidity and investment capabilities.