POU Paramount Resources (TSX:POU)
Overview: Paramount Resources Ltd. explores for and develops conventional and unconventional petroleum and natural gas reserves in Canada, with a market cap of CA$3.83 billion.
Operations: The company generates revenue from its operations in the exploration and development of both conventional and unconventional petroleum and natural gas reserves in Canada.
Estimated Discount To Fair Value: 10.1%
Paramount Resources (CA$26.1) trades below its estimated fair value of CA$29.03, presenting a potential undervaluation based on cash flows. Earnings are forecast to grow 27.48% annually, outpacing the Canadian market's 15.3%. However, shareholder dilution occurred over the past year and profit margins have declined from 35.2% to 19.7%. Recent insider selling and dividends not well covered by free cash flows are concerns despite strong revenue growth in recent quarters and ongoing share buybacks.