Production Growth in Context
Kolibri’s Q2 2025 average production of 3,220 BOEPD represents a 3 % year‑over‑year increase. In the Permian‑Basin peer set (EOG (5‑7 % YoY), Pioneer (8 % YoY), Diamondback (~4 % YoY) and the broader West‑Texas “sweet‑spot” producers such as Occidental and ConocoPhillips (flat‑to‑+1 % YoY), Kolibri’s 3 % rise sits at the lower end of the regional spectrum. The modest lift reflects the modest output from late‑2024 completions and a modest drag from shut‑ins, while many peers have been buoyed by more aggressive drilling programs and higher‑density completions that are delivering double‑digit growth in the same quarter.
Trading Implications
The sub‑par growth rate suggests a near‑term earnings drag relative to peers, which could pressure KGE’s stock if the market continues to reward higher‑growth Permian names. However, management’s guidance of “significantly higher production” from nine new wells slated for H2 2025 implies a potential 10‑15 % production boost when those wells ramp, which could lift the company’s growth curve toward the peer median. For traders, a short‑term bias may favor a wait‑and‑see stance: monitor the upcoming 2025 production guidance beat and any corresponding upward revisions to reserves. If the stock has retreated on the modest 3 % growth, a small‑cap, high‑potential play could be justified on the upside‑risk of the new‑well ramp‑up, especially if the broader market remains supportive of oil (prices above $80 /bbl) and the Permian continues to out‑perform the broader energy index. Conversely, if the stock already priced in the upcoming production lift, the current modest growth may be a signal to reduce exposure relative to higher‑growth peers. Use volume‑weighted average price (VWAP) and relative strength against the USO and the S&P 500 Energy Index to confirm entry/exit points.