Stonegate Capital Partners has initiated coverage on Pedevco Corp. (NYSE: PED), following the company's exit from fiscal year 2025 as a substantially larger, oil-weighted Rockies platform after completing its merger with Juniper. The coverage initiation comes as Pedevco demonstrates significant operational growth, with full-year production increasing 35% year-over-year to 910.1 thousand barrels of oil equivalent, revenue rising 16% to $45.8 million, and adjusted EBITDA growing 18% to $27.0 million despite facing a 19% decline in realized crude oil prices.
The company reported a net loss of $10.4 million for fiscal year 2025, compared to net income of $12.3 million in the previous year, driven primarily by merger-related costs, accelerated share-based compensation, new interest expense, a note write-off, and tax expense. However, the fourth quarter of 2025, which represents the first period reflecting the combined platform, showed dramatically improved performance with production increasing 143% year-over-year to 483.2 thousand barrels of oil equivalent, revenue more than doubling to $23.1 million, and adjusted EBITDA nearly tripling to $15.4 million.
Management emphasized that the fourth quarter results included only two months of contribution from the acquired assets, suggesting that normalized earnings power provides a more accurate perspective on the company's potential. The merger has created a platform with production capacity exceeding 6,500 barrels of oil equivalent per day and approximately 310,000 net acres, establishing a substantially larger earnings base within the company's portfolio. Pedevco now reports 32.1 million barrels of oil equivalent of proved reserves with a PV-10 value of $357.7 million, along with more than 1,000 development locations beyond the proved reserves.
Stonegate Capital Partners' analysis indicates that $10 million to $13 million of optimization work could reduce lease operating expenses by up to $1 million per month, supporting meaningful margin upside for the company. The full research report and additional materials are available through Stonegate Capital Partners' website. Stonegate Capital Partners is a leading capital markets advisory firm providing investor relations, equity research, and institutional investor outreach services for public companies, with its affiliate Stonegate Capital Markets offering a full spectrum of investment banking services.
