SilverBow Resources is an oil and gas exploration company that seems relatively undervalued despite a 300% rally YTD

SilverBow Resources Inc (NYSE: "SBOW") is an oil and gas exploration company based in Texas, USA. The stock is up 315% YTD and could gain further into the back end of the year, provided oil prices can stay where they are or higher ($70 region).

The financials look okay. The total market cap is $280m with 2020 revenue at $177m and a loss after tax of $309m. Looking more into this though it seems the pandemic did the damage as Q2 2020 (when lockdowns happened) the company lost $305m. If we look at this year's figures, revenue will be about $313m with a profit after tax of about $15-$20m, showing good improvements across the board.  Looking at the balance sheet, cash on hand is small at just $2m with total assets at $622m ($574m in equipment and property). Liabilites are reasonably high at $821m, giving SilverBlow net positive assets of $101m and a L/A ratio 83%, which is quite above average.

From a technical aspect, the stock looks strong. A pullback throughout July/August has been bought into with MACD positive and an RSI reading of 66, more upside seems likely. Support for the stock sits at $15.50. With targets of $26, $30 and then $50.

Overall this is quite an undervalued stock. Price to sales is only 1.05x which is very very fair value and for American companies, undervalued in some sense. Buying at current prices would be okay and dips should be bought into as this stock is likely to return to profitability this year and see a huge rise in revenue. This would make a great addition to a portfolio as it gives exposure to Gas and oil.