A strong performer from today's morning trading session is Equinor, whose shares rose 1.1% to $22.59 per share. For those of you thinking about investing in the stock, here is a brief value analysis of the stock using the company's basic fundamental ratios.
Equinor Is Potentially Undervalued and Trades Below Its Graham Number:
Equinor ASA, an energy company, engages in the exploration, production, transportation, refining, and marketing of petroleum and other forms of energy in Norway and internationally. The company belongs to the Energy sector, which has an average price to earnings (P/E) ratio of 13.62 and an average price to book (P/B) ratio of 1.86. In contrast, Equinor has a trailing 12 month P/E ratio of 6.9 and a P/B ratio of 1.41.
Equinor has moved -29.4% over the last year compared to 27.4% for the S&P 500 — a difference of -56.8%. Equinor has a 52 week high of $32.66 and a 52 week low of $22.15.
Growing Revenues With No Capital Eexpenditures:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $79,593 | $64,357 | $45,818 | $90,924 | $150,806 | $107,174 |
| Operating Margins | 25% | 14% | -7% | 37% | 52% | 33% |
| Net Margins | 9% | 3% | -12% | 9% | 19% | 11% |
| Net Income (M) | $7,538 | $1,851 | -$5,496 | $8,576 | $28,744 | $11,904 |
| Net Interest Expense (M) | -$1,263 | -$7 | -$836 | -$2,080 | -$207 | $2,114 |
| Depreciation & Amort. (M) | $9,249 | $13,204 | $9,515 | $10,432 | $8,878 | $9,373 |
| Diluted Shares (M) | 3,335 | 3,334 | 3,277 | 3,254 | 3,183 | 2,945 |
| Earnings Per Share | $2.27 | $0.55 | -$1.69 | $2.63 | $9.03 | $3.93 |
| EPS Growth | n/a | -75.77% | -407.27% | 255.62% | 243.35% | -56.48% |
| Free Cash Flow (M) | $19,694 | $13,749 | $10,386 | $28,816 | $26,525 | $14,126 |
| Total Debt (M) | $23,264 | $21,754 | $29,118 | $27,404 | $24,141 | $22,230 |
| Net Debt / EBITDA | 0.53 | 0.74 | 3.67 | 0.3 | 0.1 | 0.28 |
| Current Ratio | 1.57 | 1.27 | 1.58 | 1.59 | 1.77 | 1.71 |
Equinor has strong operating margins with a positive growth rate and positive EPS growth. Additionally, the company's financial statements display a decent current ratio of 1.71 and healthy leverage levels. Furthermore, Equinor has positive cash flows.
