Update shared on08 Aug 2025
Fair value Decreased 9.30%Tullow Oil’s price target was revised downward as its forward P/E multiple fell sharply, while revenue growth forecasts remained largely unchanged, resulting in a decrease in the consensus fair value from £0.256 to £0.249.
What's in the News
- Merger talks between Tullow Oil and Meren Energy have collapsed, with negotiations, which progressed as recently as June 2025, being terminated for unclear reasons (Sky News, Key Developments).
- Tullow Oil has been actively seeking strategic M&A after a sharp decline in market valuation from £15 billion to about £275 million, following the failed Kosmos Energy merger in December 2024 (Key Developments).
- Meren Energy, recently renamed from Africa Oil Corp, is substantially larger than Tullow Oil in valuation terms (Key Developments).
- Tullow Oil and its partners, including Kosmos Energy and GNPC, signed a Memorandum of Understanding with the Ghanaian government to extend key oil licenses to 2040, covering Jubilee and TEN fields (Key Developments).
- The MOU includes approval for up to 20 new wells and $2 billion investment in Ghana, with plans for increased reserves, higher gas supply targets, reduced gas pricing, and continued legislative steps expected by Q3 2025 (Key Developments).
Valuation Changes
Summary of Valuation Changes for Tullow Oil
- The Consensus Analyst Price Target has fallen slightly from £0.256 to £0.249.
- The Future P/E for Tullow Oil has significantly fallen from 6.82x to 4.88x.
- The Consensus Revenue Growth forecasts for Tullow Oil remained effectively unchanged, moving only marginally from -9.3% per annum to -9.5% per annum.
Disclaimer
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