Riley Exploration Permian Inc

Riley Exploration Permian shares have beaten the S&P 500 by 23.4% over the past six months, now trading at $36.04 for a 31.2% gain. The company, which drills for oil and natural gas in the Permian Basin, posted 36.6% annualized revenue growth over the last five years, outpacing the average upstream and integrated energy company. Its five-year average gross margin of 76.6% and free cash flow margin of 17.3% highlight strong unit economics and cash profitability. The stock currently trades at 5.1 times forward price-to-earnings.

StockStory identified two Russell 2000 stocks worth investigating and one that underwhelms. Boot Barn, a western-inspired apparel retailer with a market cap of $5.31 billion, stands out for its aggressive new store rollouts and same-store sales growth averaging 6.3% over the past two years, while its free cash flow margin jumped by 5.6 percentage points. Riley Exploration Permian, an oil and natural gas driller in the Permian Basin with a market cap of $749.2 million, is noted for 30.8% annual revenue growth over eight years, a 76.6% gross margin, and a 17.3% free cash flow margin. EverQuote, an online insurance marketplace with a market cap of $701.8 million, is flagged as a stock to sell due to excessive marketing spend signaling little organic demand.

StockStory identifies two profitable stocks with exciting potential and one facing headwinds. CECO Environmental, with a trailing 12-month GAAP operating margin of 5.7%, reported annual revenue growth of 19.9% over the past two years and projected revenue growth of 83% for the next 12 months, while share repurchases helped drive annual earnings per share growth of 23.6%. Riley Exploration Permian, operating in the Permian Basin, posted a trailing 12-month GAAP operating margin of 31.6%, annual revenue growth of 30.8% over the past eight years, a gross margin of 76.6%, and a free cash flow margin of 17.3%. In contrast, Live Nation, owner of Ticketmaster, recorded a trailing 12-month GAAP operating margin of 3%, below-average annual revenue increases of 4.6% for the last two years, and a projected 1.5 percentage point decline in its free cash flow margin next year, with shares trading at 127.9x forward P/E.