Is PXT Undervalued? Here are my reason for believing PXT isCrazy Stupid undervalued.
1) The most important thing is P/E ratio, price to earnings. I'm not just looking at the current P/E ratio, but I'm looking at the Earning History of PXT, past years EPS.,,,,,and the likelyhood of PXT earnings performance to continue into the future. PXTs EPS has been positive for several years, even in 2020 when oil price crashed into the $30s and lower I think. Remember, PXT financials are in USD. Those EPS are in USD. Share price is in CAD. Company was buying back before at around $25 saying "undervalued". Based on EPS at that time, I tend to agree.
2) Second I look at is DEBT(Liabilities) to Equity ratio. When the tough gets going, when it really gets bad, the level of Debt usually will determine if shareholders will surive or get wiped out. The level of debt will determine if the company will be handcuffed to as how they can proceed. While I don't expect oil prices to crash back down into the $30s let alone stay there for extended period of time, you just never know, it can happen again. PXT has virtually Zero Debt and has acted with common sense and best interest of shareholders when things get bad. PXT performance and what they did in 2020 proves this, from what I've noticed anyways.
3) Solid Cash Flow with Solid Profits. A company can be Profitable but still get in trouble if it has Cash Flow Problems.... And a company can have solid Cash Flow but can be bleeding Red in Profits. You want Solid Profits AND Solid Cash Flows. PXT checks this box.
4) Book Value relative to Share Price. This is pretty basic, is share price higher or lower than book value. When I first came here share price was around $12 and using stockhouse I looked at PXT financial and saw it saying Book Value was $18.13 at end of 2023. So ya, it was fairly undervalued...... but I went on posting on how I disagreed with buybacks because basically I think, based on book value, it should only be done when it's CRAZY Undervalued......... I didn't realize at that time PXT financials were in USD. That puts Book Value somewhere in the $27 range and it changed my view on EPS also. PXT was now CRAZY STUPID UNDERVALUED.
I'm super heavy in PXT right now..... Should I buy more???? Only thing stopping me from going all out CRAZY and going ALL IN is that.......
-Oil prices can CRASH and drop into the $30s or lower
-Company and Management and the financials could not be what they seem, shareholders could be getting the wool pulled over their eyes. You can't be 100% sure. But what can you do.....other than trust your gut feeling. For the most part my gut thinks everything is on the up and up.
-possible WW3 and political implications.