Dear all,
This is my first post in this group. I am a newbie guy in the world of searching for value. Please consider my beginner’s mistakes and I appreciate any thoughts from you. Please give your advice on how to tackle the company analysis more efficiently. Much appreciated!
Those things said, I came across Genel Energy, oil&gas exploration company listed in London. They operate mainly in Iraqi Kurdistan, with licenses waiting for farm-out in Morocco and Somaliland. If you look at their history, the chief guys behind were Tony Hayward, back-then the infamous BP CEO who left after Deepwater Horizon incident, and Nathaniel Rotschild, famous member of Rotschild family and investor. However, due to unsatisfactory results, majority of previous board and management members left.
Initial pricing of Genel was around 10 GBP in 2011, and it increased up to 11 GBP at one point in 2013/2014. However, due to significant reduction of actual reserves/resources, civil war in the region, global oil price decline, and other operational issues, their stock significantly decreased in price, and is currently at around 1.32 GBP. Interesting to say is that company started with dividend program in 2019 which is costing the company at the moment around 45 million $.
Their current daily production is 32000 bbl/day, and their 1P reserves 67 million, 2P 117 million barrels. This leaves them with only 5.74 years of operations momentarily, without further oil findings and developments. They are the largest producer in Iraqi Kurdistan and seem to have established okayish relationship with the regional government.
When it comes to their operational efficiency and profitability, looking at annual reports shows the decrease in equity value. As it is common in oil industry, this was due to revenues oscillating around 300 million $, and high amortization and depreciation/impairment of assets (intangibles such as reserves, and tangibles such as plant & equipment) taking off the value from equity.
Current financial parameters
Price to earnings = negative as of 2020, 20.7 as of HY 2021
The current price-to-equity ratio is 0.57
EV/EBITDAX = 7.72
Revenue is oscillating a lot, and there are significant year-to-year differences. This year, revenue is expected to be around 330 million $, and end-year FCF is expected to be positive, as around 150-200 million $ CAPEX is to take place by the end of year in development assets.
I didn’t know how I should value the company. DCF se
... keep reading on reddit ➡Ive followed the videos linked on the githubs and configured marlin as it says and all i get is tmc connection error
