Western Energy Services (WRG) AI Stock Analysis

• Market Cap: C$71.92M
• Dividend Yield: N/A
• Average Volume (3M): 968.00
• Price to Earnings (P/E): ―
• Beta (1Y): -0.03
• Revenue Growth: 5.00%
• EPS Growth: 22.76%
• Country: CA
• Employees: 615
• Sector: Energy
• Sector Strength: 51
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.14
• Shares Outstanding: 33,843,020
• 10 Day Avg. Volume: 457
• 30 Day Avg. Volume: 968
• PEG Ratio: -0.83
• Price to Book (P/B): 0.25
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.33
• 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: C$2.00
• Price Target Upside: -5.66% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 53 Neutral
• Price Target: C$2.00 ▼(-5.66%Downside)

Western Energy Services faces challenges with profitability and weak technical indicators, leading to a moderate overall stock score. The company's stable balance sheet and positive cash flow trends are strengths but are overshadowed by valuation concerns and bearish market trends.

Western Energy Services Business Overview & Revenue Model

Company Description

Western Energy Services (WRG) is a company operating in the energy sector, providing a range of services primarily focused on the oil and gas industry. The company specializes in drilling services, well servicing, and production services, offering comprehensive solutions that cater to the exploration, extraction, and maintenance needs of energy producers. WRG's core offerings are designed to support the efficient and effective operation of oil and gas fields, ensuring optimal productivity and safety standards.

How the Company Makes Money

Western Energy Services generates revenue through its extensive range of services offered to the oil and gas industry. The primary revenue streams include contract drilling services, which involve providing rigs and personnel for the drilling of oil and gas wells, and well servicing, which includes maintenance and workover services to enhance the productivity of existing wells. Additionally, WRG may earn income from ancillary services such as equipment rentals and specialized engineering support. The company typically enters into service contracts with energy producers, which dictate the terms and duration of the projects, providing a stable and predictable revenue base. Key partnerships with major oil and gas companies can also contribute significantly to WRG's earnings, leveraging long-term relationships and industry expertise to secure ongoing business.

Western Energy Services Financial Statement Overview

Summary

Western Energy Services shows resilience in cash flow and a stable balance sheet with a conservative debt position. However, it faces profitability challenges with persistent net losses, affecting overall financial health. Continued focus on profitability and cash flow stability is crucial.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	223.08M	233.45M	200.34M	131.68M	103.68M
Gross Profit	182.03M	21.82M	160.25M	89.65M	55.42M
EBITDA	42.65M	45.34M	37.94M	22.43M	10.32M
Net Income	-7.16M	-7.21M	29.00M	-35.81M	-41.30M
Balance Sheet
Total Assets	430.98M	442.93M	475.71M	456.00M	495.63M
Cash, Cash Equivalents and Short-Term Investments	3.79M	6.25M	8.88M	7.48M	19.32M
Total Debt	98.75M	115.22M	131.69M	240.42M	241.99M
Total Liabilities	135.13M	147.27M	173.18M	269.50M	273.15M
Stockholders Equity	293.62M	293.37M	300.59M	184.51M	220.80M
Cash Flow
Free Cash Flow	25.19M	28.73M	-5.69M	9.77M	24.93M
Operating Cash Flow	46.80M	51.35M	28.54M	16.63M	27.72M
Investing Cash Flow	-21.91M	-25.45M	-28.95M	-5.69M	-3.01M
Financing Cash Flow	-27.03M	-28.85M	1.44M	-22.79M	-9.41M

Western Energy Services Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.12
• 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 2.12 is below the 20-day moving average (MA) of 2.21, below the 50-day MA of 2.16, and below the 200-day MA of 2.40, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 46.19 is Neutral, neither overbought nor oversold. The STOCH value of 25.53 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	79 Outperform	C$375.50M	6.62	25.15%	9.39%	4.69%	-34.62%
SDI	73 Outperform	C$30.99M	18.45	1.91%	―	-11.14%	-84.33%
ESI	67 Neutral	C$415.58M	14.37	-1.17%	―	-2.85%	-144.20%
AKT.A	67 Neutral	C$87.14M	4.62	11.11%	―	2.57%	63.53%
WRG	53 Neutral	C$71.92M	―	-1.99%	―	5.00%	22.76%
Sector *	52 Neutral	C$2.98B	-1.53	-3.48%	6.50%	3.05%	-49.39%

Western Energy Services Corporate Events

Western Energy Services Reports Mixed Q2 2025 Results Amid Strategic Shifts

Western Energy Services Corp. reported a decrease in second-quarter 2025 revenue to $40 million, down 7% from the previous year, primarily due to lower production services revenue despite increased contract drilling in Canada. The company achieved an 11% increase in Adjusted EBITDA to $5.9 million, aided by lower reorganization costs, but faced a net loss of $4.6 million. Operationally, Canadian drilling rig utilization improved to 25%, while service rig utilization dropped to 19% due to changes in customer programs. In the U.S., the company shifted focus to North Dakota, resulting in an 8% increase in revenue per operating day.

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.