Frontera Energy Valuation

Q: What is the Fair Price of FEC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

FEC (CA$7.77) is trading above our estimate of [[fair value]] (CA$0.54)

Is FEC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of FEC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: FEC (CA$7.77) is trading above our estimate of fair value (CA$0.54)

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

Key Valuation Metric

Which metric is best to use when looking at relative valuation for FEC?

Key metric: As FEC is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for FEC. This is calculated by dividing FEC's market cap by their current earnings.
What is FEC's PE Ratio?
PE Ratio	4.6x
Earnings	US$97.28m
Market Cap	US$445.56m

FEC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.7x
Enterprise Value/EBITDA	1.8x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does FEC's PE Ratio compare to its peers?

The above table shows the PE ratio for FEC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	7.2x
KEC Kiwetinohk Energy	10.1x	93.6%	CA$660.8m
OBE Obsidian Energy	4.9x	15.4%	CA$576.6m
CJ Cardinal Energy	9.9x	6.3%	CA$1.0b
TAL PetroTal	3.8x	-4.6%	CA$593.2m
FEC Frontera Energy	4.6x	n/a	CA$627.8m

Price-To-Earnings vs Peers: FEC is good value based on its Price-To-Earnings Ratio (4.6x) compared to the peer average (7.2x).

Price to Earnings Ratio vs Industry

How does FEC's PE Ratio compare vs other companies in the CA Oil and Gas Industry?

7 Companies	Price / Earnings	Estimated Growth	Market Cap
HAM Highwood Asset Management	1.2x	-43.9%	US$62.92m
ALPS.U Alpine Summit Energy Partners	1x	n/a	US$24.02m
KUB.H Carcetti Capital	0.7x	n/a	US$5.82m
GCOM Green Shift Commodities	1.6x	n/a	US$4.89m

7 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: FEC is good value based on its Price-To-Earnings Ratio (4.6x) compared to the Canadian Oil and Gas industry average (10.8x).

Price to Earnings Ratio vs Fair Ratio

What is FEC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

FEC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	4.6x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate FEC's Price-To-Earnings Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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