Let’s cut to the chase: Civitas Resources (NYSE: NYSE: CIVI ) is one of those hidden gems. It’s a profitable, capital-disciplined oil producer with some of the best acreage in the Lower 48, a strong hedge book, and clear visibility into production growth inAnalyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in CIVI, ...

Industry Overview - The Zacks Oil and Gas - Exploration and Production - United States industry is facing challenges due to lower crude prices influenced by geopolitical factors and an oversupply of natural gas [1][3][5] - The industry is currently ranked 186 out of 245 Zacks industries, placing it in the bottom 24% [8][10] - The industry's earnings estimates for 2025 have decreased by 41.6% over the past year, indicating a negative outlook [10] Key Trends - Easing geopolitical tensions have led to a reduction in oil prices, with WTI crude trading around $65, impacting companies reliant on higher prices for new investments [3][4] - OPEC forecasts a significant increase in global oil demand to 123 million barrels per day by 2050, necessitating an investment of $18.2 trillion in the oil and gas sector [4] - Natural gas production in the U.S. has reached record levels, with storage exceeding seasonal norms by 6%, which may limit price increases [5] - The International Energy Agency (IEA) predicts a slowdown in global oil demand growth post-2026 due to the rise of electric vehicles and cleaner energy policies [6][7] Company Highlights - **W&T Offshore (WTI)**: A leading oil and natural gas explorer with a market capitalization of nearly $270 million, known for its disciplined operations and positive cash flow for 28 consecutive quarters [18][19] - **EQT Corporation (EQT)**: The largest natural gas producer in the U.S. with a market cap of approximately $35 billion, expected EPS growth rate of 46.3% over the next three to five years [21][22] - **APA Corporation (APA)**: Engaged in exploration and production with a market cap of around $7 billion, known for its successful drilling in Suriname and the Permian Basin [23][24] - **Civitas Resources (CIVI)**: Focused on the DJ Basin and Permian Basin, with a market cap of about $2.8 billion, recognized for strong well returns and shareholder returns [26][27] Valuation Metrics - The industry is currently trading at an EV/EBITDA ratio of 11.28X, significantly lower than the S&P 500's 17.71X, but above the sector's 4.86X [15]

Group 1 - The energy sector is currently the worst performer in the S&P 500, with Civitas Resources Inc. (NYSE: CIVI) down by 33% year-to-date [1] - Despite the poor performance, there is a belief that Civitas Resources Inc. can end the year in positive territory [1] - The focus is on identifying strongly undervalued stocks within various sectors and geographies [1] Group 2 - The author has a background in business studies from France, the U.S., and Russia, and is a professional portfolio manager based in Luxembourg [1] - The author operates as a Popular Investor on the eToro platform, where investment opinions and decisions are publicly displayed [1]

Core Viewpoint - Civitas Resources, Inc. is under investigation for potential breaches of fiduciary duties by its officers and directors, linked to allegations of misrepresentation regarding the company's oil production and financial condition [1][2]. Group 1: Allegations of Misrepresentation - Insiders at Civitas Resources allegedly caused the company to misrepresent its likelihood of significantly reducing oil production in 2025 due to declines following a production peak in Q4 2024 and a low TIL count at the end of 2024 [2]. - The company may need to acquire additional acreage and development locations to increase oil production, which could lead to significant debt and necessitate the sale of corporate assets to offset acquisition costs [2]. - Civitas's financial condition may require disruptive cost-reduction measures, including a significant workforce reduction, indicating that the company's business and financial prospects were overstated [2]. - The public statements made by Civitas were reportedly materially false and misleading at all relevant times [2].

Group 1 - The Daily Drilling Report is an investment group focused on providing analysis for the oil and gas industry, featuring a model portfolio that encompasses all segments of upstream oilfield activity with weekly updates [1] - The group offers investment ideas for both U.S. and international energy companies, covering a range from shale to deepwater drillers [1] - Technical analysis is utilized to identify catalysts within the oil and gas sector [1] Group 2 - Fluidsdoc is an international oil industry veteran with 40 years of experience, specializing in the upstream oilpatch and having worked in over twenty countries [2]

Core Insights - Class actions have been initiated for stockholders of Open Lending Corporation and Civitas Resources, with deadlines for lead plaintiff petitions approaching [1] Open Lending Corporation (NASDAQ:LPRO) - The class period for Open Lending is from February 24, 2022, to March 31, 2025, with a lead plaintiff deadline of June 30, 2025 [2] - Allegations include materially false and misleading statements regarding the company's risk-based pricing models, profit share revenue, and the value of vintage loans from 2021 and 2022 [2] - The complaint asserts that the company's positive statements about its business and prospects were misleading and lacked a reasonable basis [2] Civitas Resources, Inc. (NYSE:CIVI) - The class period for Civitas Resources is from February 27, 2024, to February 24, 2025, with a lead plaintiff deadline of July 1, 2025 [3] - Allegations include misleading statements about the likelihood of significant oil production reductions in 2025 and the need for additional acreage and development locations, which could incur significant debt [3] - The lawsuit claims that Civitas Resources' financial condition would necessitate disruptive cost reduction measures, including workforce reductions, and that its business and financial prospects were overstated [3] - On February 24, 2025, Civitas reported Q4 2024 revenue of $1.29 billion, missing estimates by $3.44 million, and non-GAAP EPS of $1.78, missing by $0.21 [4] - The company projected a year-over-year decline in oil production of approximately 4%, alongside a $300 million transaction to expand its Permian Basin position and a $300 million divestment target [4] - Following the announcement, Civitas Resources' stock price fell by more than 18% [4]

Core Viewpoint - Civitas Resources, Inc. is facing a class action securities lawsuit due to alleged securities fraud that affected investors between February 27, 2024, and February 24, 2025 [1] Group 1: Lawsuit Details - The lawsuit claims that Civitas was likely to significantly reduce its oil production in 2025 due to declines following a production peak at the DJ Basin in Q4 2024 and a low TIL count at the end of 2024 [2] - Increasing oil production would necessitate acquiring additional acreage and development locations, leading to significant debt and potential asset sales to cover acquisition costs [2] - The financial condition of Civitas would require disruptive cost reduction measures, including a significant workforce reduction [2] - Consequently, the business and financial prospects, as well as operational capabilities of Civitas, were overstated, making public statements materially false and misleading [2] Group 2: Next Steps for Investors - Investors who suffered losses in Civitas Resources during the relevant timeframe have until July 1, 2025, to request the Court to appoint them as lead plaintiff [3] - Class members may be entitled to compensation without any out-of-pocket costs or fees, and participation does not require serving as a lead plaintiff [3] Group 3: Firm Background - Levi & Korsinsky has a history of securing hundreds of millions of dollars for shareholders and has a strong track record in high-stakes cases [4] - The firm specializes in complex securities litigation and has a team of over 70 employees dedicated to serving clients [4] - For seven consecutive years, Levi & Korsinsky has been ranked in the Top 50 Report by ISS Securities Class Action Services as one of the leading securities litigation firms in the U.S. [4]

Core Viewpoint - A securities class action lawsuit has been filed against Civitas Resources, Inc. for failing to disclose significant production reductions and operational challenges during the Class Period from February 27, 2024, to February 24, 2025 [1][3]. Company Overview - Civitas Resources, Inc. is a crude oil and natural gas company headquartered in Denver [2]. Financial Performance - For Q4 and full-year 2024, Civitas reported revenue of $1.29 billion, missing consensus estimates by $3.44 million, and non-GAAP earnings per share of $1.78, which was $0.21 below expectations [4]. - The net income for the quarter was $151.1 million, or $1.57 per share, a decline from $302.9 million, or $3.23 per share, in the same quarter the previous year [4]. Operational Challenges - Civitas indicated that it is likely to significantly reduce oil production in 2025 due to natural declines after peak production in the DJ Basin in Q4 2024 [3]. - The company announced a 10% workforce reduction and the termination of its Chief Operating Officer and Chief Transformation Officer [5]. Market Reaction - Following the announcement of its financial results and operational outlook, Civitas's stock price fell by $8.95 per share, or 18%, closing at $40.35 per share on February 25, 2025 [6].

Core Viewpoint - A lawsuit has been filed against Civitas Resources, Inc. and its senior executives for potential violations of federal securities laws, specifically related to misleading statements about the company's production capabilities and financial health [1][2][3]. Group 1: Lawsuit Details - The lawsuit is pending in the U.S. District Court for the District of New Jersey, titled Lin v. Civitas Resources, et al., No. 25-cv-03791, and claims are made under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 [2]. - Investors have until July 1, 2025, to request to be appointed to lead the case [2]. Group 2: Company Background - Civitas Resources is an oil and gas exploration and production company with key assets in the Denver-Julesburg Basin in Colorado and the Permian Basin in Texas and New Mexico [3]. - The company claimed to have "enhanced recovery potential" and "driven production ahead of plans," while asserting that costs were below expectations [3]. Group 3: Financial Performance and Stock Impact - On February 24, 2025, Civitas announced disappointing Q4 and full year 2024 results, revealing that oil production had peaked and would require significant capital investment to increase production [4]. - Following the announcement, Civitas's stock price dropped over 18%, from $49.30 per share to $40.35 per share [4].

Core Viewpoint - Civitas Resources, Inc. is facing a class action lawsuit due to allegedly misleading statements regarding its oil production and financial condition during the specified class period from February 27, 2024, to February 24, 2025 [1][3]. Group 1: Class Action Details - The Rosen Law Firm is reminding investors of the July 1, 2025, deadline to become a lead plaintiff in the class action against Civitas Resources [1][2]. - Investors who purchased Civitas securities during the class period may be entitled to compensation without any out-of-pocket fees through a contingency fee arrangement [1][2]. Group 2: Allegations Against Civitas - The lawsuit claims that Civitas made materially false and misleading statements, failing to disclose significant reductions in oil production expected in 2025 due to declines in the DJ Basin and low TIL counts [3]. - It is alleged that increasing oil production would necessitate acquiring additional acreage, leading to significant debt and asset sales to cover acquisition costs [3]. - The financial condition of Civitas is said to require disruptive cost-reduction measures, including a significant workforce reduction, which were not disclosed [3]. - The lawsuit asserts that Civitas' business and financial prospects were overstated, resulting in false and misleading public statements [3]. Group 3: Rosen Law Firm's Credentials - The Rosen Law Firm has a strong track record in securities class actions, having achieved the largest settlement against a Chinese company at the time and being ranked No. 1 for securities class action settlements in 2017 [4]. - The firm has consistently ranked in the top 4 for securities class action settlements since 2013 and has recovered hundreds of millions of dollars for investors [4]. - In 2019, the firm secured over $438 million for investors, showcasing its effectiveness in litigation [4].