Valeura Energy Inc. T.VLE

Question for all

[Chincy1]

I would be interested to hear what some of you believe a fair / conservative p/e ratio that would be fitting for VLE based on the information we have? Cheers and thx.

[windymayor1]

E&Ps dont trade on P/E ratios.

[windymayor1]

DACF is a more realistic ratio for this sector.  Maintain SPECULATIVE BUY. Increasing target price to $8.25/sh, equivalent to a 2.0x multiple of our new 2023 debt-adjusted cash flow forecast

[Chincy1]

thanks @windymayor1

[nozzpack]

Basically, debt-adjusted cash flow (DACF) is pre tax cash flow plus financing costs after tax. It may also include exploration expenses. A bit more robust than EV / Ebitda but not too dissimilar. DACF is useful because companies finance themselves differently, with some relying more on debt.

[nozzpack]

Signifucant too, in valuation of an oil stock is whether it pays a dividend which will boost its DACF multiple. SG has stated that VLE will pay a dvidend. Typically, mid tiers used to trade at a dividend yield averaging about 2.5% but that is more volatile now due to oil price volatility. So,  assuming a return to more steady state oil prices, if VLE pays a dividend of, say, 16 cents... 4

[Hannamuk]

Equinor PE ratio as of December 14, 2022 is 5.59. Earnings will be interesting here!

[Hannamuk]

Chincy, estimated earnings from you?

[Chincy1]

@hannamuk Ok all in fun I will take a stab at my coffee shop back of the napkin;  $30M USD per month cash flows from New Assets  $3M USD per month cash flows from Wassana once started  So $33M US / month or $396M USD per year cash flow  $396 usd is $534M Cdn per year 

[Hannamuk]

Earning is what's needed  

[Chincy1]

@hannamuk - your earnings call and a fair multiple you would give on those earnings?

[Hannamuk]

Multiple 5-6..

[SlowAndSteady7]

How deliberately vague :).