Obsidian Energy Ltd T.OBE

1QFFO/ share compared to share price- Industry comparison

[Hendrick3]

Funds flow from operations is a good measure of economic performance and 1Q is a good indication of the future performance of oil abd gas companies as higher oil prices start to emerge. I have compared various companies FFO/ share relative to their share price and finally the number of quarters to achieve the share price ( low number best)

               1Q FFO/ share.       Share price.   Xquarters
ATH.            .04.                       .75.                 18.8
BTE.            .28.                      1.75.                  6.3
IPO.             .09.                       .65.                  7.2
OBE.            .49.                     2.03.                  4.1
TVE.            .16.                      2.61.                16.3
WCP.           .36.                      5.54.                 15.4
YGR.            .20.                     1.17.                 5.85

All these numbers suggest tremendous under valuation as anything under 20 ( 5 years funds flow multiple is under valued. Some are much more than others.

[Rational43]

The other factor to consider is debt.  Some of these, like OBE and BTE and ATH, are highly indebted. OBEs Debt at around $480 M is about 8 x their annual free cash flow this year, per their May investor presentation.   During the last six years of pain some of these companies have turned themselves into zombies, the walking dead. for a few years at least.   US shale

[Hendrick3]

Your point is valid which makes ATH even more overvalued on a relative basis. In regards OBE, their net debt is $455 which is slightly higher than ATH but they produced 12 times the funds flow per share. Market cap of ATH close to $400 million. OBE is under $150 million.  Any way you slice it, the valuation of OBE is massively undervalued relative to these other players.  I also did

[Hendrick3]

Now can add CPG and BNE            FFO/ share.       Share price.       Xquarters BNE.       .50.                    $4.50.                9 CPG.       .49.