TSX:ERF

Stock Analysis Report

Executive Summary

Enerplus Corporation, together with subsidiaries, engages in the exploration and development of crude oil and natural gas in the United States and Canada.

Rewards

Trading at 58.3% below its fair value

Revenue is forecast to grow 6.74% per year

Earnings grew by 190.3% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -5.4% per year for the next 3 years

Highly volatile share price over past 3 months

Significant insider selling over the past 3 months



Snowflake Analysis

Outstanding track record and good value.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

0.4%

ERF

-0.7%

CA Oil and Gas

0.2%

CA Market


1 Year Return

-39.1%

ERF

-1.1%

CA Oil and Gas

4.9%

CA Market

Return vs Industry: ERF underperformed the Canadian Oil and Gas industry which returned 0.2% over the past year.

Return vs Market: ERF underperformed the Canadian Market which returned 5.8% over the past year.


Shareholder returns

ERFIndustryMarket
7 Day0.4%-0.7%0.2%
30 Day-17.1%-2.7%0.4%
90 Day-17.3%2.8%3.7%
1 Year-38.3%-39.1%3.2%-1.1%8.2%4.9%
3 Year-39.4%-41.3%-6.5%-16.5%15.9%5.5%
5 Year-39.5%-46.2%-9.8%-24.1%33.8%14.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ERF (CA$6.98) is trading below our estimate of fair value (CA$16.75)

Significantly Below Fair Value: ERF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ERF is good value based on its PE Ratio (3.9x) compared to the Oil and Gas industry average (11x).

PE vs Market: ERF is good value based on its PE Ratio (3.9x) compared to the Canadian market (15.9x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: ERF is overvalued based on its PB Ratio (0.8x) compared to the CA Oil and Gas industry average (0.7x).


Next Steps

Future Growth

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

-5.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ERF's earnings are forecast to decline over the next 3 years (-5.4% per year).

Earnings vs Market: ERF's earnings are forecast to decline over the next 3 years (-5.4% per year).

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

Revenue vs Market: ERF's revenue (6.7% per year) is forecast to grow faster than the Canadian market (5% per year).

High Growth Revenue: ERF's revenue (6.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ERF's Return on Equity is forecast to be low in 3 years time (7.3%).


Next Steps

Past Performance

How has Enerplus performed over the past 5 years?

36.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ERF has high quality earnings.

Growing Profit Margin: ERF's current net profit margins (35.7%) are higher than last year (12.5%).


Past Earnings Growth Analysis

Earnings Trend: ERF has become profitable over the past 5 years, growing earnings by 36.9% per year.

Accelerating Growth: ERF's earnings growth over the past year (190.3%) exceeds its 5-year average (36.9% per year).

Earnings vs Industry: ERF earnings growth over the past year (190.3%) exceeded the Oil and Gas industry 6%.


Return on Equity

High ROE: ERF's Return on Equity (21.4%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Enerplus's financial position?


Financial Position Analysis

Short Term Liabilities: ERF's short term assets (CA$359.2M) do not cover its short term liabilities (CA$396.5M).

Long Term Liabilities: ERF's short term assets (CA$359.2M) do not cover its long term liabilities (CA$687.9M).


Debt to Equity History and Analysis

Debt Level: ERF's debt to equity ratio (31.6%) is considered satisfactory.

Reducing Debt: ERF's debt to equity ratio has reduced from 53.1% to 31.6% over the past 5 years.


Balance Sheet

Inventory Level: ERF has a high level of physical assets or inventory.

Debt Coverage by Assets: ERF's debt is not covered by short term assets (assets are 0.6x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: ERF is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: ERF is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

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

1.72%

Current Dividend Yield


Dividend Yield vs Market

company1.7%marketbottom25%1.9%markettop25%5.3%industryaverage4.8%forecastin3Years1.7%

Current dividend yield vs market & industry

Notable Dividend: ERF's dividend (1.72%) isn’t notable compared to the bottom 25% of dividend payers in the Canadian market (1.89%).

High Dividend: ERF's dividend (1.72%) is low compared to the top 25% of dividend payers in the Canadian market (5.32%).


Stability and Growth of Payments

Stable Dividend: ERF's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (6.8%), ERF's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ERF's dividends in 3 years are forecast to be thoroughly covered by earnings (9.5% payout ratio).


Next Steps

Management

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

4.4yrs

Average management tenure


CEO

Ian Dundas (51yo)

6.6yrs

Tenure

CA$4,036,341

Compensation

Mr. Ian Charles Dundas, B.Comm., LLB, has been the Chief Executive Officer and President at Enerplus Corporation since July 1, 2013. Mr. Dundas served as Chief Operating Officer at Enerplus Corporation fro ...


CEO Compensation Analysis

Compensation vs Market: Ian's total compensation ($USD3.05M) is above average for companies of similar size in the Canadian market ($USD1.58M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Ian Dundas
President6.6yrsCA$4.04m0.040% CA$631.6k
Jodine J. Labrie
Senior VP & CFO4.4yrsCA$1.91m0.017% CA$263.7k
Raymond Daniels
Executive Officer0yrsCA$2.11m0.0093% CA$145.2k
Edward McLaughlin
President of U.S. Operations7.8yrsCA$1.59m0.0081% CA$127.2k
Nathan Fisher
Vice President of U.S. Development & Geosciences4.4yrsCA$1.33m0.0094% CA$146.7k
Wade Hutchings
Senior VP & COO0yrsno datano data
Drew Mair
Manager of Investor Relations0yrsno datano data
David McCoy
VP, General Counsel & Corporate Secretary0yrsCA$815.32k0.0078% CA$122.8k
Garth Doll
Vice President of Marketing1yrsno data0.0047% CA$73.2k

4.4yrs

Average Tenure

51yo

Average Age

Experienced Management: ERF's management team is considered experienced (4.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ian Dundas
President6.6yrsCA$4.04m0.040% CA$631.6k
Elliott Pew
Independent Chairman of the Board5.7yrsCA$307.00k0.020% CA$310.3k
Robert Hodgins
Independent Director12.3yrsCA$180.50k0.017% CA$260.1k
Michael Culbert
Independent Director6yrsCA$170.58k0.0044% CA$69.6k
Hilary Foulkes
Independent Director6yrsCA$160.50k0.0024% CA$38.3k
Sheldon Steeves
Independent Director7.7yrsCA$170.50k0.00071% CA$11.1k
Susan MacKenzie
Independent Director8.6yrsCA$167.10k0.0029% CA$44.9k
Jeffrey Sheets
Independent Director2.2yrsCA$169.50k0.0063% CA$98.9k
Karen Clarke-Whistler
Independent Director1.2yrsno data0.00089% CA$13.9k
Judith Buie
Director0.08yrsno datano data

6.0yrs

Average Tenure

62yo

Average Age

Experienced Board: ERF's board of directors are considered experienced (6 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: ERF insiders have sold more shares than they have bought 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

Enerplus Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Enerplus Corporation
  • Ticker: ERF
  • Exchange: TSX
  • Founded: 1986
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Market Cap: CA$1.564b
  • Shares outstanding: 224.75m
  • Website: https://www.enerplus.com

Number of Employees


Location

  • Enerplus Corporation
  • The Dome Tower
  • Suite 3000
  • Calgary
  • Alberta
  • T2P 2Z1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ERFTSX (The Toronto Stock Exchange)YesCommon SharesCACADJan 1990
ERFNYSE (New York Stock Exchange)YesCommon SharesUSUSDJan 1990
E17DB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1990

Biography

Enerplus Corporation, together with subsidiaries, engages in the exploration and development of crude oil and natural gas in the United States and Canada. The company’s oil and natural gas properties are located primarily in North Dakota, Montana, Colorado, and Pennsylvania; and Alberta, British Columbia, and Saskatchewan. As of December 31, 2018, it had proved plus probable gross reserves of approximately 12.7 million barrels (MMbbls) of light and medium crude oil; 28.4 MMbbls of heavy crude oil; 167.2 MMbbls of tight oil; 21.1 MMbbls of natural gas liquids; 41.1 billion cubic feet (Bcf) of conventional natural gas; and 1,149.5 Bcf of shale gas. The company was founded in 1986 and is headquartered in Calgary, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 02:08
End of Day Share Price2020/02/18 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.