ASX:ORG

Stock Analysis Report

Executive Summary

Origin Energy Limited, an integrated energy company, engages in the exploration and production of natural gas, electricity generation, wholesale and retail sale of electricity and gas, and sale of liquefied natural gas in Australia and internationally.


Snowflake Analysis

Second-rate dividend payer and slightly overvalued.


Similar Companies

Share Price & News

How has Origin Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ORG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

7.4%

ORG

10.2%

AU Oil and Gas

4.9%

AU Market


1 Year Return

-29.2%

ORG

-38.0%

AU Oil and Gas

-14.2%

AU Market

Return vs Industry: ORG exceeded the Australian Oil and Gas industry which returned -39.7% over the past year.

Return vs Market: ORG underperformed the Australian Market which returned -16.5% over the past year.


Shareholder returns

ORGIndustryMarket
7 Day7.4%10.2%4.9%
30 Day-14.1%-5.6%-8.9%
90 Day-41.6%-40.3%-22.7%
1 Year-26.2%-29.2%-35.3%-38.0%-10.3%-14.2%
3 Year-28.3%-32.2%-28.5%-37.3%2.6%-11.6%
5 Year-48.6%-59.8%-32.6%-44.7%13.9%-11.8%

Price Volatility Vs. Market

How volatile is Origin Energy's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Origin Energy undervalued compared to its fair value and its price relative to the market?

8.85x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ORG (A$4.86) is trading above our estimate of fair value (A$4.1)

Significantly Below Fair Value: ORG is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ORG is poor value based on its PE Ratio (8.4x) compared to the Oil and Gas industry average (8.2x).

PE vs Market: ORG is good value based on its PE Ratio (8.4x) compared to the Australian market (13.4x).


Price to Earnings Growth Ratio

PEG Ratio: ORG's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: ORG is good value based on its PB Ratio (0.6x) compared to the AU Oil and Gas industry average (0.8x).


Next Steps

Future Growth

How is Origin Energy forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

-4.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ORG's earnings are forecast to decline over the next 3 years (-4% per year).

Earnings vs Market: ORG's earnings are forecast to decline over the next 3 years (-4% per year).

High Growth Earnings: ORG's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ORG's revenue is expected to decline over the next 3 years (-0.3% per year).

High Growth Revenue: ORG's revenue is forecast to decline over the next 3 years (-0.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ORG's Return on Equity is forecast to be low in 3 years time (6%).


Next Steps

Past Performance

How has Origin Energy performed over the past 5 years?

46.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ORG has a large one-off gain of A$371.0M impacting its December 31 2019 financial results.

Growing Profit Margin: ORG's current net profit margins (7.3%) are lower than last year (8.1%).


Past Earnings Growth Analysis

Earnings Trend: ORG has become profitable over the past 5 years, growing earnings by 46.3% per year.

Accelerating Growth: ORG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ORG had negative earnings growth (-16.3%) over the past year, making it difficult to compare to the Oil and Gas industry average (-16%).


Return on Equity

High ROE: ORG's Return on Equity (7.4%) is considered low.


Next Steps

Financial Health

How is Origin Energy's financial position?


Financial Position Analysis

Short Term Liabilities: ORG's short term assets (A$4.2B) do not cover its short term liabilities (A$4.4B).

Long Term Liabilities: ORG's short term assets (A$4.2B) do not cover its long term liabilities (A$6.4B).


Debt to Equity History and Analysis

Debt Level: ORG's debt to equity ratio (46.3%) is considered high.

Reducing Debt: ORG's debt to equity ratio has reduced from 79.1% to 46.3% over the past 5 years.

Debt Coverage: ORG's debt is not well covered by operating cash flow (17.6%).

Interest Coverage: ORG's interest payments on its debt are well covered by EBIT (3.4x coverage).


Balance Sheet


Next Steps

Dividend

What is Origin Energy's current dividend yield, its reliability and sustainability?

5.88%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ORG's dividend (6.17%) is higher than the bottom 25% of dividend payers in the Australian market (3.01%).

High Dividend: ORG's dividend (6.17%) is low compared to the top 25% of dividend payers in the Australian market (7.94%).


Stability and Growth of Payments

Stable Dividend: ORG's dividend payments have been volatile in the past 10 years.

Growing Dividend: ORG's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (52%), ORG's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ORG's dividends in 3 years are forecast to be covered by earnings (78.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

Frank Calabria (51yo)

3.5s

Tenure

AU$4,597,000

Compensation

Mr. Frank G. Calabria, BEc, GradDip AppFin, MBA, FCA, FFin, has been the Chief Executive Officer, Managing Director and Executive Director of Origin Energy Limited since October 19, 2016. Mr. Calabria has  ...


CEO Compensation Analysis

Compensation vs Market: Frank's total compensation ($USD2.84M) is about average for companies of similar size in the Australian market ($USD2.86M).

Compensation vs Earnings: Frank's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Frank Calabria
MD, CEO & Executive Director3.5yrsAU$4.60m0.025% A$2.1m
Lawrence Tremaine
Chief Financial Officer2.75yrsAU$2.97m0.014% A$1.2m
Greg Jarvis
Executive General Manager of Energy Supply & Operations3.33yrsAU$1.71m0.0041% A$347.5k
Jon Briskin
Executive General Manager of Retail3.33yrsAU$1.50m0.0042% A$360.3k
Mark Schubert
Executive General Manager of Integrated Gas4.92yrsAU$1.62m0.0051% A$435.7k
Kylie FitzGerald
Director of Group Communications & Investor Relationsno datano datano data
Andrew Clarke
Group General Counselno datano datano data
Anthony Lucas
Executive General Manager of Future Energy & Business Development3.33yrsno datano data
Sharon Ridgway
Executive General Manager of People & Culture3.33yrsno datano data
Helen Hardy
Company Secretary9.83yrsno datano data

3.3yrs

Average Tenure

Experienced Management: ORG's management team is considered experienced (3.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Frank Calabria
MD, CEO & Executive Director3.5yrsAU$4.60m0.025% A$2.1m
Gordon Cairns
Independent Non-Executive Chairman6.5yrsAU$679.00k0.0093% A$795.1k
Steven Sargent
Independent Non-Executive Director4.92yrsAU$233.20k0.0018% A$152.4k
John Akehurst
Independent Non-Executive Director11yrsAU$254.20k0.0040% A$345.8k
Scott Perkins
Independent Non-Executive Director4.58yrsAU$287.20k0.0017% A$145.5k
Teresa Engelhard
Independent Non-Executive Director2.92yrsAU$241.20k0.0019% A$166.9k
Greg Lalicker
Independent Non-Executive Director1.08yrsAU$61.10k0.0057% A$486.2k
Maxine Brenner
Independent Non-Executive Director6.42yrsAU$262.20k0.0016% A$137.8k
Bruce William Morgan
Independent Non-Executive Director7.42yrsAU$289.20k0.0027% A$229.4k

4.9yrs

Average Tenure

58yo

Average Age

Experienced Board: ORG's board of directors are considered experienced (4.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Origin Energy Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Origin Energy Limited
  • Ticker: ORG
  • Exchange: ASX
  • Founded: 1946
  • Industry: Integrated Oil and Gas
  • Sector: Energy
  • Market Cap: AU$8.559b
  • Shares outstanding: 1.76b
  • Website: https://www.originenergy.com.au

Number of Employees


Location

  • Origin Energy Limited
  • Tower 1
  • Level 32
  • Barangaroo
  • New South Wales
  • 2000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
OGFG.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1980
ORGASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJan 1980
ORLDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1980
ORGCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJan 1980
OGFG.YOTCPK (Pink Sheets LLC)UNSPONSORED ADRUSUSDDec 2008

Biography

Origin Energy Limited, an integrated energy company, engages in the exploration and production of natural gas, electricity generation, wholesale and retail sale of electricity and gas, and sale of liquefied natural gas in Australia and internationally. The company operates in Energy Markets and Integrated Gas segments. Its exploration and production portfolio includes the Bowen and Surat basins in Queensland; the Browse basin in Western Australia; and the Beetaloo Basin in the Northern Territory. The company also generates electricity from coal, wind, pumped water storage, solar, and cogeneration plants; sells electricity, natural gas, and LPG; provides GreenPower and green gas products; and supplies LPG to homes and businesses. In addition, it offers electric and gas hot water systems, as well as hot water systems repair and replacement services; split system air conditioners; ducted heating solutions; and ducted evaporative cooling systems. The company serves approximately 4.2 million electricity customers. Origin Energy Limited was founded in 1946 and is based in Barangaroo, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/09 10:33
End of Day Share Price2020/04/09 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.