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Highlights
- 88 Energy’s evaluation results of the Merlin-1 well recently and showed the existence of oil at the Cretaceous Nanushuk Formation.
- IQE’s revenues for H1 2021 (ended 30 June 2021) stood at £79 million, in line with the issued guidance at £87 million.
- Union Jack Oil reported increased revenue of £158,004 for the full-year 2020 compared to £136,959 in 2019.
Alternative Investment Market (AIM), a sub-market of the London Stock Exchange (LSE), offer investors several ways to leverage government-sponsored tax reliefs and other forms of loss relief. Careful selection of the right stock and identification of strong fundamentals and growth prospects may be vital in improving an investor’s stock-picking within the AIM.
Here is a detailed review of 3 FTSE AIM-listed stocks to explore their investment prospect.
88 Energy Limited (LON: 88E)
88 Energy Limited is an exploration company. Recently, the company announced the post-well evaluation results of the Merlin-1 well (drilled in March 2021 to a depth of 5,267 ft) and shown the presence of oil at the Cretaceous Nanushuk Formation.
For the quarter ended 30 June 2021, 88 Energy recorded A$14.8 million cash and zero debt. In June 2021, the company disposed off its Alaskan Oil and Gas Tax Credits held by Accumulate Energy Alaska, its wholly-owned subsidiary, for a cash consideration of US$18.7 million. The funds from the sales were used for repayment of the company’s US$16.1 million debt.
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The shares of 88 Energy have given a return of 556.41 per cent in the last one year, and the market capitalisation stood at £223.49 million as of 25 August 2021.
IQE Plc (LON:IQE)
IQE Plc is a company engaged in manufacturing advanced semiconductor wafer products and materials. The company’s revenues for H1 2021 (ended 30 June 2021) stood at £79 million in line with the issued guidance at £87 million (H1 2020: £89.9 million). The growth in revenues during H1 can be attributed to the continued strong demand for wireless products for 5G handsets and WiFi 6 routers, offsetting a year-on-year decline in the wireless 5G infrastructure products segment. The company’s adjusted EBITDA was also in line with the issued guidance at £16 million for H1 2021 (H1 2020: £16.4 million).
IQE shares closed at GBX 50.70, up by 2.84 per cent on 25 August 2021. The market capitalisation stood at £395.39 million.
Union Jack Oil Plc (LON:UJO)
Union Jack Oil is engaged in onshore hydrocarbon production, development and exploration. On 24 August 2021, the company’s Wressle oil field production exceeded its targeted rate of 500 barrels during the testing stage.
Union Jack Oil reported increased revenue of £158,004 for the full-year 2020 compared to £136,959 in 2019. The company’s recorded cash balance was in excess of £5.7 million as of 1 May 2021, excluding royalty accruals and loan receivables of more than £1 million.
Union Jack Oil’s shares traded at GBX 33.00 at market close on 25 August 2021, and the market cap stood at £32.70 million.
Conclusion:
The lifting of lockdown restrictions has resulted in the resumption of activities across most sectors of the economy. Shares in the oil and gas sector have surged on the back of rising prices. Union Jack Oil and 88 Energy Limited are in the news due to new explorations and testing of operations at these facilities. Additionally, the launch of 5G services and the need for high-speed WiFi drive demand for related infrastructure such as semiconductor chips, thus making IQE an ideal stock to watch out for.
