HNRC Has A Strong Debt To Equity Ratio Of Less Than 2%

Rhea-AI Summary

Houston Natural Resources Corp. (OTC: HNRC) reported a robust debt-to-equity ratio of less than 2%, positioning it favorably for future acquisitions in the oil sector, where the industry’s threshold is around 40%. The company's net asset value is $4.71 per share, with proven reserves valued at $69 million. HNRC's subsidiaries hold assets totaling $9.67 per share, prompting plans for asset sales and potential dividends. With a target valuation of $6.16 to $10.78 per share based on industry metrics, HNRC aims for an up-listing to OTCQX or a major exchange.

Positive

• Debt-to-equity ratio below 2%, providing strong financial leverage.
• Net asset value at $4.71 per share and proven reserves worth $4.47 per share.
• Total asset value of $9.67 per share, suggesting significant shareholder value.
• Plans for asset realization through potential sales and dividends.

Negative

• None.

HOUSTON, Aug. 5, 2021 /PRNewswire/ -- Houston Natural Resources Corp. (OTC: HNRC) ("HNR or the Company") has a strong balance sheet to continue its aggressive growth in 2021 with a debt- to-equity ratio of less than 2%.

The oil industry has about a 40% debt-to-capital threshold. Above that level, debt costs increase considerably. The company has been able to use its low debt ratio to acquire equipment and is now well positioned to make future acquisitions.

According to Investopedia… "Investors in the oil and gas industry should keep an eye on the debt levels on the balance sheet. It is such a capital-intensive industry that high levels of debt can put a strain on a company's credit ratings, weakening its ability to purchase new equipment or finance other capital projects. Poor credit ratings can also harm its ability to acquire new businesses."

In addition, Investopedia states… "Debt, when used properly, can increase shareholder returns. Having too much debt, however, leaves firms vulnerable to economic downturns and interest rate hikes. Too much debt can also increase the perceived risk with the business and discourage investors from investing more capital."

The Company's net asset value is $4.71 per share for the period ending March 31, 2021. 

In addition, the Company's subsidiary Houston Natural Resources, Inc ("HNRI") has independently appraised value of $69,000,000 in proven reserves that are valued at $4.47 per share. HNR Oil Services LLC, has independently appraised value of $7,600,000 in equipment and permits that are valued a $0.49 per share.

The company currently has a total of $9.67 per share in assets. The Company intends to focus on realizing the value on  the total of $9.67 per share in assets held by its subsidiaries for the benefit of the shareholders. The strategy may include asset sales, a spin-off of one or more of its subsidiaries and dividends to shareholders.

According to industry research, the S&P 500 Integrated Oil & Gas Index, forward earnings, & valuation, as of August 4, 2021, is between 8x and 14x forward earnings. This would imply a target value for HNRC of $6.16 per share and $10.78 per share based on its projected earning.

HNRC is a diversified holding company that has two subsidiaries, Houston Natural Resources, Inc ("HNRI") and Worldwide Diversified Holdings, Inc ("WDHI"). HNRI owns oil and gas properties and a waste-water treatment plant. WDHI has business operations that provide products & services in the Information Technology & Healthcare markets. HNRC anticipates up listing onto OTCQX or major exchange. The company is preparing an SEC filing to become an SEC reporting company.

About Houston Natural Resources Corp

Houston Natural Resources Corp (www.HoustonNaturalResources.com) (OTC:HNRC). The Company is dedicated to increasing shareholder value through developing natural resources with state-of-the-art innovative technologies in tandem with sustainable environmental services of toxic oil field waste disposal and recycling that are environmentally safe and socially responsible. 

About Worldwide Diversified Holdings, Inc.

Worldwide Diversified Holdings, Inc.(www.wdhinc.net). The company is a diversified holding company with business operations and investments. The portfolio companies include investments in information technology and healthcare.

FORWARD-LOOKING STATEMENTS:

This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties.

Contact:

Houston Natural Resources Corp.
E-mail: frank@HoustonNaturalResources.com
Houston Texas USA.

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SOURCE Houston Natural Resources Corp.

FAQ

What is Houston Natural Resources Corp's debt-to-equity ratio?

Houston Natural Resources Corp has a debt-to-equity ratio of less than 2%.

What is the net asset value per share for HNRC?

The net asset value for Houston Natural Resources Corp is $4.71 per share.

What are the proven reserves valued at for HNRC?

The proven reserves for HNRC are independently appraised at $69 million, valued at $4.47 per share.

What is the target share value for HNRC based on industry metrics?

The target share value for HNRC ranges from $6.16 to $10.78 based on forward earnings.

What future plans does HNRC have regarding its subsidiaries?

HNRC plans to realize value from its subsidiaries through asset sales and potential dividends.