Earnings call transcript: Ranger Energy Services Q2 2025 beats EPS estimates

Ranger Energy Services Inc. (RNGR) reported its second-quarter 2025 earnings, surpassing analysts’ expectations with an EPS of $0.32, exceeding the forecasted $0.23 by 39.13%. The company fell short on revenue, reporting $140.6 million against the expected $143.4 million, a negative surprise of 1.95%. Following the announcement, Ranger Energy’s stock rose 9.18% in regular trading and saw a 10.34% increase in premarket trading, reflecting investor optimism. According to InvestingPro data, the company maintains strong financial health with a "GREAT" overall score of 3.29, supported by robust cash flow and profitability metrics.

Key Takeaways

• EPS beat expectations by 39.13%, while revenue fell short by 1.95%.
• Stock surged over 9% post-announcement, continuing to rise in premarket trading.
• Successful launch of ECO rigs, emphasizing sustainability and innovation.
• Wireline Services returned to profitability, contributing positively to EBITDA.
• Stable demand in core service lines despite declining rig counts.

Company Performance

Ranger Energy Services demonstrated resilience in Q2 2025, with revenues increasing 4% sequentially and 2% year-over-year. The company’s focus on innovation, particularly the introduction of the ECO rig, positions it well in the evolving energy sector. Despite challenges such as declining rig counts, Ranger maintained stable demand in its core service lines and captured incremental market share during industry contractions.

Financial Highlights

• Revenue: $140.6 million, up 4% sequentially and 2% year-over-year.
• Earnings per share: $0.32, surpassing the forecast by 39.13%.
• Adjusted EBITDA: $20.6 million, an increase of 33% sequentially.
• Free cash flow year-to-date: $17.8 million, up 45% from the previous year.

Earnings vs. Forecast

Ranger Energy’s EPS of $0.32 significantly exceeded the forecast of $0.23, marking a 39.13% surprise. This performance highlights the company’s ability to manage costs and drive profitability despite revenue falling short of expectations by 1.95%.

Market Reaction

The stock price of Ranger Energy Services experienced a notable increase, closing 9.18% higher following the earnings announcement. In premarket trading, the stock continued its upward trajectory with a 10.34% rise. This movement reflects investor confidence in the company’s strategic initiatives and operational efficiency. InvestingPro analysis indicates the stock is currently undervalued, trading at an attractive PEG ratio of 0.53, suggesting room for further appreciation. For investors interested in identifying similar opportunities, check out the Most Undervalued Stocks list on InvestingPro.

Outlook & Guidance

Looking ahead, Ranger Energy anticipates stability in Q3 but remains cautious about Q4 due to potential winter slowdowns. The company plans disciplined capital allocation and aims to expand its ECO rig fleet, with the potential for 20+ rigs in the next 3-5 years. Continued share repurchases and exploration of M&A opportunities are also on the agenda.

Executive Commentary

CEO Stuart Boden emphasized the practical innovation of the ECO rig, stating, "This is not innovation for its own sake. This is practical innovation that improves operations, enhances safety, reduces emissions." CFO Melissa Kugel reaffirmed the company’s focus on delivering high-quality service while investing in targeted innovation.

Risks and Challenges

• Declining rig counts could impact future drilling and completion services.
• Potential market saturation in core service lines.
• Macroeconomic pressures, including fluctuating energy prices.
• Seasonal impacts, particularly during Q4, could affect operations.
• Supply chain disruptions may hinder the timely construction of new ECO rigs.

Q&A

During the earnings call, analysts inquired about the economics of the new ECO rigs and their potential adoption rate by initial customers. Management highlighted the rigs’ comparable economics to traditional rigs and expressed optimism about rapid adoption. Additionally, questions focused on improvements in Wireline Services and the company’s flexible capital spending approach.

Full transcript - Ranger Energy Services Inc (RNGR) Q2 2025:

Conference Operator: Good day, and welcome to the Ranger Energy Services Second Quarter twenty twenty five Conference Call. All participants will be in a listen only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the call over to Joe Meese, Vice President of Finance.

Please go ahead.

Joe Meese, Vice President of Finance, Ranger Energy Services: Thank you, and welcome to Ranger Energy Services’ second quarter twenty twenty five results conference call. Ranger has issued a press release outlining our operational and financial performance for the three months ended 06/30/2025. The press release and accompanying presentation materials are available in the Investor Relations section of our website at www.rangerenergy.com. Today’s discussion may contain forward looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today’s forward looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the Securities and Exchange Commission.

Except as required by law, we undertake no obligation to update our forward looking statements. Further, please note that non GAAP financial measures will be referenced during this call. A full reconciliation of GAAP to non GAAP measurements is available in our latest quarterly earnings release and conference call presentation. With that, I would like to now turn the conference call over to our CEO, Stuart Boden and our CFO, Melissa Kugel, for their prepared remarks.

Stuart Boden, CEO, Ranger Energy Services: Thanks, Joe. Good morning, everyone. Today, I’m pleased to report another strong quarter for Ranger. Second quarter results reflect the resilience of our production oriented strategy, the hard work of our field teams and our ongoing commitment to disciplined execution. We exited the winter with a strong pickup in activity early in the second quarter, which has continued into the summer months.

We have seen higher than normal levels of asset turnover as certain customers adjusted their well programs in light of current market conditions. That said, demand in Ranger’s core service lines remained strong and Ranger’s results showcased the consistent earnings power and resilience of our business model, our focus on capital discipline and our ability to lead the sector in innovation. For the second quarter, we reported $140,600,000 in revenue, a year over year improvement that is impressive given the drilling rig and frac spread declines currently impacting drilling and completion exposed businesses. Ranger reported $20,600,000 of adjusted EBITDA for the quarter achieving 14.7% margins consistent with last year’s performance and sequentially stronger than Q1. All segments delivered sequentially improving results despite falling rig counts with company wide Q2 revenue and adjusted EBITDA improving 433% quarter over quarter respectively.

Our High Spec Rig segment continued to be the cornerstone of our business contributing $86,300,000 of revenue and $17,600,000 of adjusted EBITDA with margins staying over 20%, again demonstrating the stability and profitability of production focused services. Activity levels and customer demand remained stable, although managing through recent white space has put some pressure on margins. We are encouraged by a consistent base of work heading into the second half of the year and the resilience and pricing stability we have seen thus far. Ancillary services and wireline both improved quarter over quarter with ancillary services generating $32,200,000 in revenue and $6,600,000 in adjusted EBITDA. Our coiled tubing service line saw a significant improvement quarter over quarter with consistent demand for our coil spreads as weather conditions improved in the spring, while our rentals and torrent service lines saw continued strength and resiliency.

Our P and A service line has seen a pullback in activity by some customers given the discretionary nature of these costs, although the long term growth potential of this vital and environmentally sensitive work remains intact, while regulatory bodies and customers contend with an ever aging population of wells in the Lower 48. Wireline achieved a meaningful turnaround this quarter with positive adjusted EBITDA of 1,600,000 on $22,100,000 of revenue once winter effects subsided and our restabilization efforts improved profitability. Our work in this segment continues. With this quarter’s result, we are also proud to announce a transformational milestone in Well Servicing, the launch of our ECO rig, the industry’s first hybrid double electric workover rig. This technology is the culmination of two years of engineering effort from trusted manufacturing partners converting an existing Taylor rig design uniquely available to Ranger.

It borrows technologies from outside traditional oil and gas and applies electrification strategies from other industrial sectors that are truly differentiated from anything on the market today. It also utilizes Ranger’s existing spare asset capacity for conversion to reduce construction costs and avoid further market saturation. These rigs bring a long list of enhanced benefits, but some of the key highlights of this hybrid rig solution include a zero emissions profile when wellsite power is available with a 90% reduction in emissions even in off grid settings. Operations that are stunningly quiet when compared to traditional conventional rigs, improving the ability of crews to communicate and coordinate activities. A fully electric drivetrain that utilizes regenerative braking with precision draw works, remote safety lockout and a digital interface capable of applying machine learning, which is a game changer in conducting safe and optimized operations.

A plug and play modular construction design that will allow for major component maintenance and replacement without significant downtime and a thirty minute recharge window that can be conducted during continuous operations. Ranger committed to two Echo rigs earlier this year with both currently under construction and anticipated to be delivered and tested before the end of Q3. The rigs have been contracted with two major U. S. Operators with provisions ensuring capital return thresholds are met as well as options for future rig conversions.

We spent time this past year ensuring that the Echo platform is scalable and capital efficient with costs that are shared with our customers and or captured in an uplifted rate. Simply stated, the Echo rig is poised to reshape how well servicing work gets done in the Lower 48. This is not innovation for its own sake. This is practical innovation that improves operations, enhances safety, reduces emissions and positions Ranger to lead the way as operator expectations continue to evolve. It also demonstrates our engineering leadership and our ability to bring forward looking solutions to the market at the right moment.

Before I turn the call over to Melissa, I’d also like to provide some thoughts on Ranger’s current strategic priorities and our views as we look to the second half of the year. The past couple of years have brought newfound pressures in this space as new activity lows seem to be a recurring theme each quarter. Despite this market pressure, Ranger has been able to produce consistent, durable and strong cash flows and has shown the ability to put these cash flows to smart use, whether through buybacks or targeted CapEx investment. We have had some pressures in select service lines, but they remain isolated without affecting our core service lines. When we look towards the back half of the year, we see continued shuffling in rig deployments that can bring about some white space in schedules and margin pressures.

That said, our base of work remains stable and we feel the third quarter will show continued resilience. The fourth quarter has historically been unpredictable depending on customer budget exhaustion and general macro sentiment and we feel this year will be no different. We will provide additional color as available during our third quarter earnings call. Ranger’s strategic priorities remain the same. We will be disciplined capital allocators who look to maximize free cash flow and prioritize shareholder returns.

We believe that further growth in the future will be key for Ranger and in the same way we approach the basic asset acquisition in 2021 and in development of our new Echo rig, we will be thoughtful and meticulous in our pursuit of accretive M and A and organic growth opportunities that create value for Ranger shareholders and ensure our balance sheet strength is protected. We remain a partner of choice to large consolidated E and Ps, who prioritize safety, reliability and multi basin reach. That strength has allowed us to capture incremental market share these past couple of years during contraction. Finally, I want to commend our field teams and support staff. Our people are Ranger’s greatest assets and their dedication and discipline are what makes these results possible.

With that, I’ll turn it over to our CFO, Melissa Kugel.

Melissa Kugel, CFO, Ranger Energy Services: Thanks, Stuart, and good morning, everyone. As mentioned, Ranger showed up in the second quarter with another set of consistent results, further reinforcing our production focused resiliency in the face of declining rig counts. Second quarter revenue was $140,600,000 up 4% sequentially from Q1 and up 2% year over year when comparing to the 2024. Adjusted EBITDA for the second quarter was $20,600,000 a sequential increase of 33% from the first quarter and 2% lower than the prior year quarter due to both service line mix and some margin pressure from rig transitions between customers. Consolidated margins were 14.7, a significant improvement from the first quarter and consistent to those seen in the 2024.

From a segment perspective, the High Specification Rig segment reported $86,300,000 in revenue and $17,600,000 in adjusted EBITDA. Revenues slipped slightly quarter over quarter and improved year over year, while adjusted EBITDA and associated margins improved quarter over quarter and decreased year over year. Rig hours have continued to improve and grow showing strong demand and utilization of the fleet. While pricing slipped 2% quarter over quarter, these declines were isolated and driven largely by adjustments to rig packaging profiles. Turning to Processing Solutions and Ancillary Services, revenues for the quarter were $32,200,000 an improvement of 6% from the prior quarter and 4% from the prior year quarter.

Adjusted EBITDA for the segment was $6,600,000 with 20.5% margins for the second quarter, an improvement from the first quarter but decreased from the prior year due to service line contribution mix. Wireline returned to profitability with positive EBITDA of $1,600,000 on $22,100,000 of revenue, a significant sequential improvement that we believe is repeatable in the third quarter. We remain focused on creating a more consistent activity profile and looking for ways to further drive down fixed costs. Ranger’s balance sheet is stronger than ever. Free cash flow year to date totaled $17,800,000 up 45% from the prior year and we exited June with $48,900,000 of cash and $120,100,000 of total liquidity.

We deployed a portion of our liquidity during the quarter repurchasing 278,000 shares of Ranger stock for a total spend of $3,300,000 These share repurchases have continued into the third quarter as we see the Ranger share price at current levels as an incredibly compelling investment and use of capital. We paid our quarterly dividend of $06 per share on May 23 and today our Board approved the third quarter’s dividend. That brings our capital returns to shareholders as of June 30 to well over $5,000,000 in line with our ongoing commitment to returning at least 25% of free cash flow to shareholders annually. Turning to the back half of the year, we expect continued stability in Q3. High spec rigs and ancillary services should continue to show steady performance while wireline’s recovery is being closely managed.

We are optimistic about third quarter performance while cautious once we enter the fourth quarter and winter weather arrives, which will likely slow activities once more. CapEx spending remains disciplined and we are holding prior guidance having made select investments this year in the Echo rigs Stuart discussed earlier. We have begun trimming CapEx whenever possible to give us maximum flexibility in responding to market conditions. We will remain focused on delivering high quality service while investing in targeted innovation that supports long term profitability and shareholder returns. With that, I’ll turn the call back over to Stuart for closing comments.

Stuart Boden, CEO, Ranger Energy Services: Thanks Melissa. To summarize, Q2 reflects the strength and consistency of our business model, strong cash conversion, resilient core segments and disciplined execution. Importantly, it also is the exciting start of something new with the launch of Echo, a platform that showcases how Ranger can lead with innovation without sacrificing returns or reliability. We remain committed to generating free cash flow, returning capital to shareholders, maintaining balance sheet strength and delivering smart growth, both organically and through selective M and A. Thanks again to our employees, partners and shareholders for your continued support.

With that, operator, I would like to open up the call for questions.

Conference Operator: Thank you. We will now begin the question and answer session. The first question comes from Don Crist with Johnson Rice. Please go ahead.

Don Crist, Analyst, Johnson Rice: Good morning, Stuart and Melissa. Hope you all doing well.

Respondent, Ranger Energy Services: You too. Good morning, Don.

Don Crist, Analyst, Johnson Rice: I wanted to start with the new Echorig contract. Congrats for getting this over the finish line after two years. But I’m assuming that these assets are going to cost a touch more. But on the contract, is it designed to have a similar payback as you would on a normal rig? I’m just assuming that these are going to be a little bit more expensive for the operator, but save money in the long run from a diesel perspective.

Stuart Boden, CEO, Ranger Energy Services: Yes. I’ll kick it off and then listen to chime in Don. So the short answer is we do think they’ll have very similar return profiles or maybe even better. We’ll see how the market is. The way that we thought about it is, you’re right, there’s an incremental cost to doing these refurbs and making the Echo rigs over and above what we would typically do in a complete refurb.

The customers have the two contracts we referenced, the customers have spent a lot of time with us, and they have a lot of faith in the technology. So they have actually through kind of a combination of down payments and agreements for increased rates over a defined set of hours, to pay or to help share that incremental cost. And when you kind of put that all together, we get very similar return profiles as a typical REIT for us.

Don Crist, Analyst, Johnson Rice: Okay. And I wanted to ask about wireline services. Obviously that market has been challenged for quite a while, but there’s been some M and A in the sector, companies going away and others buying other companies. And in the second quarter, your results were much better than I would have expected. And I wanted to know if the market was tightening, and some of those excess assets are going away through M and A or is it something more on your side that you’re doing to control cost and boost margin?

Stuart Boden, CEO, Ranger Energy Services: I think on the impact of potential consolidation in the wireline, I think it’s too early to tell, Don, or too early to really see the benefits of it. I think the improvements are really related to two things. One is the team really has done a great job of really getting incredibly focused on costs and managing labor costs and fixed costs. So a lot of that has been on the Ranger side. The second thing is just as you move out of Q1 and into Q2, we do typically see kind of steadier activity in Q2, particularly in the North and we did see that.

So some benefit from the market, I would also say a lot of benefit from internal actions.

Don Crist, Analyst, Johnson Rice: Okay. And then one final one for me. You were not the first company this quarter to say that the fourth quarter is kind of uncertain at this time. But do you think there’s an opportunity for some of the gas basins to pick up and kind of fill in some of those white spaces that may crop up in the fourth quarter through other actions in the gas in the oil basins?

Stuart Boden, CEO, Ranger Energy Services: I think we’re certainly hopeful that that could be the case, Don. We certainly saw that earlier this year when the forward curve firmed up in gas, we saw an increase in activity

Respondent, Ranger Energy Services: and then a little bit

Stuart Boden, CEO, Ranger Energy Services: of a slowdown once it declined. But I think there is that. Think also a lot will just depend on where people are as relative to their budgets and production profiles as you get into the back half of the year. It’s just too early to say, but certainly a strengthening gas market would help for sure.

Don Crist, Analyst, Johnson Rice: Exactly. All right. I’ll turn it back to the operator. I appreciate the color.

Stuart Boden, CEO, Ranger Energy Services: All right. Thanks, Don.

Conference Operator: Thank you. The next question comes from Derek Pauthiser from Piper Sandler. Please go ahead.

Derek Pauthiser, Analyst, Piper Sandler: Hey, good morning. I wanted to ask a question around scaling the Echo rig. Just how do we think about that, whether this is customer demand driven? Where do we go from two rigs to something greater than that? How should we is it a natural maintenance cycle or natural attrition of your legacy rigs?

Maybe just some more help so we can understand what the total addressable market can be for the Echo rig in the future.

Stuart Boden, CEO, Ranger Energy Services: Sure. Thanks for the question, Derek. Good to have you on. I think right now, I think it’s really related to customer demand. I think we are we don’t want build a number of these and build it and hope they will come.

So I think it will really be tied to customer demand. What I would say though is based on the conversations we’ve been having with the two customers in particular and some other customers have looked at it as well. There appears to be significant demand for this. And I think it’s hard to know exactly what the TAM is ultimately on this. But I do think that if we had in the next three to five years 20 plus ECO rigs out it, don’t think it would surprise us.

But I think we do just want to make sure we’re being really disciplined about how we spend the capital related to Echo and make sure that they’re tied to customer to specific customer demand.

Derek Pauthiser, Analyst, Piper Sandler: Is this basin agnostic and these go in every basin across The U. S?

Stuart Boden, CEO, Ranger Energy Services: They can. Interestingly, the two that are deploying, one is going to be deployed in the Permian Basin, one is going to be deployed in the North. So we are actually testing different kind of weather packages with the two different rigs that are going out. Yes, it will be weather agnostic basin agnostic.

Derek Pauthiser, Analyst, Piper Sandler: Right, right. That makes sense. So sticking on high spec rigs, I noticed the rig hours obviously picked up here, so that’s great to see. And looking back in the model, I mean, we’re at the highest level since 2022. Maybe could you just help us again understand holistically the primary drivers of that?

Obviously, you’re an efficient operator, safety and all that, you had some vendor consolidation. But what’s helping you capture that market share? Or is it just this focus on production efficiencies from your customer? Maybe just help us understand what the big drivers are that we’re seeing this rig hour increase despite kind of this deflationary market that we’ve been in, in U. S.

Land since 2022.

Stuart Boden, CEO, Ranger Energy Services: It really is a combination of the things that you just said. So one is, as you know, have really worked hard to make sure we have strong relationships with the biggest players just because we think they have the most consistent profiles and that continues. So a lot of it has been driven by that. A lot of it has been as we’ve talked about before just on the back of consolidation generally and particularly in high spec rigs consolidation has helped us. I think the other thing I would say is when you kind of look at the customer mix, we are really having kind of increased success in deploying rigs for kind of not necessarily the majors, but other larger customers, but even some kind of mid tier from a size perspective.

And I think the reason that we’re getting that work really is around efficiency, safety, reliability, etcetera.

Derek Pauthiser, Analyst, Piper Sandler: Got it. Okay. That’s helpful. Just last one for me. Torrent, you guys mentioned it in the release, but maybe just an update there.

I know it’s an exciting growth avenue for you guys. I think you previously guided us doubling EBITDA in 2025. But maybe where does TORD stand? And how do you think about it as we move through the rest of the year to next year?

Stuart Boden, CEO, Ranger Energy Services: I think right now it remains on track to double EBITDA. It’s again, I think it’s been pretty steady. The team has done a great job of kind of enhancing the customer base. I think as we look to the year, I think the big decision for us is what kind of capital do we want to deploy into that business. Again, it will need to be tied to customer demand.

I don’t think we just want to do kind of spec builds. But again, right now, it looks to be kind of on track for the year.

Respondent, Ranger Energy Services: Great. That’s all I got. Thanks. I’ll send it back.

Stuart Boden, CEO, Ranger Energy Services: Thanks, Derek.

Conference Operator: Thank you. The next question is from John Daniel with Daniel Energy Partners. Please go ahead.

Respondent, Ranger Energy Services: Hey, guys. I guess I’m going to focus on Echo as well. Stuart, when you some of your customers have like 50 plus rigs, workover rigs across the country at any given time. And I would assume that the people that are starting with the Echo are the larger, higher quality names. I’m just curious, when someone adopts one or two of these rigs, how quickly will they would you expect or hope that they would really rapidly accelerate?

Because if you’re using one and you’re having a good experience, like it would seem like you’d want to have more than one, if that makes any sense. So just let you have pontificate.

Stuart Boden, CEO, Ranger Energy Services: Yes. It makes a lot of sense. What I would say is with both of the customers we’re talking about, I think we mentioned in the press release and mentioned in the script that there’s basically an option to build additional rigs for both of these customers. They are both indicating that they would like additional rigs. Again, they’ve spent a lot of time with us.

They’re very familiar with the technology, or they have gotten themselves very familiar with the technology. So to that point, it wouldn’t surprise us. We don’t have anything firmed up yet, but we’re having a lot of conversations, John. It wouldn’t surprise us that very quickly they come back and ask us for a number of additional Echo rigs.

Respondent, Ranger Energy Services: Okay. And then, one more for me. I don’t know if you want to disclose it. But from the time you started retrofitting Echo Rig one to the time it was completed, I’m curious like what that time frame was? And then what’s the optimal time frame you could get it down to once you start seeing multiple repeating orders?

How quickly can you improve the retrofit process?

Stuart Boden, CEO, Ranger Energy Services: Yes. We think that just given the demand that we think is going to come, we’ve been talking a lot with our vendors on this. The first Echo rig has been think months, right? It’s been number of months. But I think that when we sit down and we talk with the vendors, we think that we can actually get it down significantly quicker than that.

The one thing I will say is that there are a number of long lead time items, right, so particularly around batteries. And so I think that’s one of the things that when we’ve been talking to customers is that if they say, hey, I want one and make it up March 2026, well, that means we need to start sort of buying long lead time items now, right, or very quickly. So that’s kind of the nature of the conversation. But assuming we have those items in place, the actual reefer process can be pretty quick.

Respondent, Ranger Energy Services: Got it. Okay. That’s all I got. Thanks for having me.

Conference Operator: Thank you. The next question comes from Peter Sidoti from Sidoti and Company. Please go ahead.

John Daniel, Analyst, Daniel Energy Partners: Hi. I wonder if you gentlemen or you can give me a handle on capital spending And you seem to be building a fairly large cash award here, strong balance sheet. If you could provide a little more meat on what you’ll be doing with that?

Melissa Kugel, CFO, Ranger Energy Services: Hi, Peter. It’s great to have you. So I’ll take that and give a start and Stuart can tuck in behind it. So what we previously guided was year over year similar, so in the ballpark of low 30s, and we don’t see that being particularly different this year. Echo was included in that budget, if

Respondent, Ranger Energy Services: you

Melissa Kugel, CFO, Ranger Energy Services: will. So I think we see steady state. We are looking at, hey, if the market got a lot worse, could we throttle it back a little bit in the back half of the year? We’ll see. The Echo rigs are more than 50% paid for, about twothree paid for it at this point.

As far as the cash balance, we do have a cash balance. I think there is a lot of discussions we have internally around capital allocation. You saw us start to spend. We were a little bit hesitant at the beginning of the year when the market started to inflect, and part of it was just sort of some cautiousness. We also saw a lot of support in the stock price at a much higher level.

Then we had Liberation Day, then we had OPEC come in behind. So we just thought it was prudent to kind of take a little bit of a step back. This summer, we actually saw the distribution of our largest shareholder, And you saw us kind of start to take a put our toe back in the water, so to speak. We’ve done repurchases. We intend to continue to do repurchases.

They have continued into Q3 as I made in my comments. I think the balance remains wanting to hold on to a little bit. So to the extent the share price is a really compelling investment for us. I think you would see us continue to do that because we do have the 25% minimum commitment. I think what we also are measured by is as we think about Echo and potential demand in the future, the customer conversations are going in a few different directions.

Some include some upfront sort of CapEx sharing, some include uplifted rates, as Stuart said. So that’s giving us some reflection and wanting to make sure we have cash on hand if it looks like we need to outlay for that. And I think there’s always a little bit of holding on to a little bit of cash is never a bad thing because our M and A conversations, which you really didn’t touch on because we’re so excited about Echo. But our M and A conversations have been richer lately. So if that ever eventually, I think we do hold a lot of optimism and a belief that we will get additional M and A transactions done in due course.

And I think being able to support some of that with capital would be constructive for us as well. So I think we view it as making sure we have enough cash to kind of go in a few different directions because there are several paths in front of us, and we want to make sure we can support all of them without levering up. Is that helpful?

John Daniel, Analyst, Daniel Energy Partners: Yes.

Stuart Boden, CEO, Ranger Energy Services: Peter, I don’t have anything to add. Melissa said it exactly right. I mean, I think the intention is through a combination of repurchases and potential M and A, that those would all be good uses of cash. The only thing I would say is when we speak to investors, we’re not out and specifically trying to build a war chest, right? I think that’s just kind of how it’s happened a little bit.

But again, I think we see real opportunities both through capital returns and also M and A in the future.

John Daniel, Analyst, Daniel Energy Partners: Thank you very much.

Conference Operator: Thank you. Thank you. This concludes our question and answer session. I would like to turn the conference back to Stuart Boden for closing remarks.

Stuart Boden, CEO, Ranger Energy Services: Thanks, Steve. Again, thanks to everyone, to our employees, our partners, our investors for your continued interest in Ranger. We’re very excited about Echo. Please follow us and follow along on social media. We’ll have more things being announced in the coming months around Echo.

So again, thank you very much and hope everyone has a great week.

Conference Operator: The conference now has concluded. Thank you for attending today’s presentation. You may now disconnect.

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