Primeenergy Resources Corp (NASDAQ: PNRG)

Sector: Energy Industry: Oil & Gas E&P CIK: 0000056868
Market Cap 275.90 Mn
P/B 1.29
P/E 10.95
P/S 1.39
ROIC (Qtr) 13.05
Div Yield % 0.00
Rev 1y % (Qtr) -33.81
Total Debt (Qtr) 0.00
Debt/Equity (Qtr) 0.00
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About

Investment thesis

Bull case

  • Operating cash flow of 108.45M provides exceptional 44.03x coverage of interest expenses 2.46M, showing strong debt service capability.
  • Strong operating cash flow of 108.45M provides 6.40x coverage of SG&A expenses 16.93M, showing efficient operational cost management.
  • Tangible assets of 332.02M provide robust 18.35x coverage of other current liabilities 18.10M, indicating strong asset backing.
  • Operating cash flow of 108.45M fully covers other non-current liabilities 72.96M by 1.49x, showing strong long-term stability.
  • Operating cash flow of 108.45M provides solid 2.40x coverage of current liabilities 45.27M, showing strong operational health.

Bear case

  • Operating cash flow of 108.45M barely covers its investment activities of (88.09M), with a coverage ratio of -1.23, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Free cash flow of 20.36M provides weak coverage of capital expenditures of 88.09M, with a 0.23 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 35.41M show weak coverage of depreciation charges of 85.89M, with a 0.41 ratio indicating high capital intensity and potential reinvestment needs.
  • High depreciation of 85.89M relative to operating cash flow of 108.45M, which is 0.79x suggests significant maintenance capital requirements affecting free cash flow.
  • High financing cash flow of (18.25M) relative to working capital of (21.23M), which is 0.86x suggests concerning dependence on external funding for operational needs.

Peer comparison

Companies in the Oil & Gas E&P
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 COP Conocophillips 136.62 Bn 17.10 2.22 23.44 Bn
2 CNQ Canadian Natural Resources Ltd 85.21 Bn 17.67 3.04 12.51 Bn
3 EOG Eog Resources Inc 66.33 Bn -60.48 8.67 8.13 Bn
4 FANG Diamondback Energy, Inc. 49.64 Bn -2,818.83 314.47 16.24 Bn
5 OXY Occidental Petroleum Corp /De/ 37.18 Bn 15.36 2.56 22.88 Bn
6 WDS Woodside Energy Group Ltd 34.64 Bn 11.73 2.51 -
7 TPL Texas Pacific Land Corp 29.74 Bn 126.16 78.66 0.02 Bn
8 DVN Devon Energy Corp/De 18.80 Bn 3.24 1.91 8.55 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.86 1.02
EV to Cash from Ops. EV/CFO 2.63 18.21
EV to Debt EV to Debt 0.00 54.57
EV to EBIT EV/EBIT 8.06 29.98
EV to EBITDA EV/EBITDA 2.35 19.64
EV to Free Cash Flow [EV/FCF] EV/FCF 14.02 39.33
EV to Market Cap EV to Market Cap 1.03 1.57
EV to Revenue EV/Rev 1.44 11.47
Price to Book Value [P/B] P/B 1.29 2.97
Price to Earnings [P/E] P/E 10.95 -25.98
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 26.80
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 31.86
Dividend per Basic Share Div per Share (Qtr) 0.00 0.78
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.05
Interest Coverage Int. cover (Qtr) 14.38 -4.97
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 37.22 -533.65
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 133.19 52.06
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -5.45
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -54.70 6.14
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -5.41 105.89
EBIT Growth (1y) % EBIT 1y % (Qtr) -52.33 75.94
EBT Growth (1y) % EBT 1y % (Qtr) -55.05 17.44
EPS Growth (1y) % EPS 1y % (Qtr) -53.94 3.07
FCF Growth (1y) % FCF 1y % (Qtr) 303.40 -43.36
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -5.67 149.32
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.60 0.33
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.07
Cash Ratio Cash Ratio (Qtr) 0.08 1.32
Current Ratio Curr Ratio (Qtr) 0.53 2.37
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 0.34
Interest Cover Ratio Int Coverage (Qtr) 14.38 -4.97
Times Interest Earned Times Interest Earned (Qtr) 14.38 -4.97
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 61.10 16.19
EBIT Margin % EBIT Margin % (Qtr) 17.83 -16.83
EBT Margin % EBT Margin % (Qtr) 16.59 -24.06
Gross Margin % Gross Margin % (Qtr) 70.00 58.92
Net Profit Margin % Net Margin % (Qtr) 12.70 -28.75