Sable Offshore Corp. (SOC): A Bull Case Theory

We came across a bullish thesis on Sable Offshore Corp. (SOC) on Welfare Capital Research’s Substack. In this article, we will summarize the bulls’ thesis on SOC. Sable Offshore Corp. (SOC)’s share was trading at $32.10 as of 23^rd May. SOC’s trailing and forward P/E were 47.20 and 1670 respectively according to Yahoo Finance.

Sable Offshore (SOC) delivered a major catalyst with the announcement of a production restart at platform Harmony and the near-completion of onshore pipeline hydrotests, reigniting investor confidence in the stock. Shares surged over 60% within a week, reaching new all-time highs from a previously depressed base. The move prompted a timely reentry by the writer, influenced by a fellow investor who had framed the core bullish thesis effectively.

Even after the sharp rally, shares were seen as attractive around $30 due to reduced risk and the potential for strong future capital returns, including a meaningful dividend yield. On the heels of this rally, Sable executed a $290 million equity offering at $29.50, resulting in roughly 10% dilution. However, this was seen as a net positive, especially considering CEO Jim Flores—who owns 20% of the company—participated in the dilution himself, signaling alignment rather than shareholder exploitation.

The market reaction was muted, with shares only down about 1% post-offering, reflecting investor approval. The raise boosts Sable’s cash position to just under $500 million, providing ample liquidity to scale production and execute its growth strategy. With a $1.5 billion mixed securities shelf filed in April, future capital raises—likely in the form of debt—are expected to refinance $850 million owed to Exxon, potentially on better terms given market support. The author holds a 15% portfolio allocation to SOC at a $24.22 average cost, reinforcing conviction in the name and positioning for significant upside as production ramps and financial optionality increases.

Previously, we have covered Sable Offshore Corp. (SOC) in January 2025 wherein we summarized a bullish thesis by Kooky_Lime1793 on r/wallstreetbets. In the reddit post, Sable Offshore (NYSE:SOC) was highlighted as a compelling turnaround story due to its acquisition of the Santa Ynez Unit from ExxonMobil at a steep discount. The user emphasized the asset’s massive production potential, with projections of up to 30 million barrels annually and free cash flow of up to $1.65 billion, offering a nearly 20x upside in the best-case scenario. Despite regulatory risks, the author argued that successful production restart and shareholder return initiatives could drive the stock well above $40. Since our last coverage, the stock is up 40.17% as of 26^th May.

Sable Offshore Corp. (SOC) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held SOC at the end of the fourth quarter which was 22 in the previous quarter. While we acknowledge the risk and potential of SOC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SOC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.