We’ve recently updated our valuation analysis.

MEG Energy Valuation

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

Valuation Score

3/6

Valuation Score 3/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

MEG 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/Revenue1.3x
Enterprise Value/EBITDA3.9x
PEG Ratio-3.6x

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for MEG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average8.7x
CPG Crescent Point Energy
2.6x-42.7%CA$5.5b
PSK PrairieSky Royalty
18.6xn/aCA$5.4b
ERF Enerplus
5.3x11.0%CA$5.4b
POU Paramount Resources
8.6xn/aCA$4.5b
MEG MEG Energy
6.9x-2.7%CA$6.0b

Price-To-Earnings vs Peers: MEG is good value based on its Price-To-Earnings Ratio (6.9x) compared to the peer average (8.8x).


Price to Earnings Ratio vs Industry

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

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a-4.2%
n/an/an/a

Price-To-Earnings vs Industry: MEG is expensive based on its Price-To-Earnings Ratio (6.9x) compared to the Canadian Oil and Gas industry average (5.4x)


Price to Earnings Ratio vs Fair Ratio

What is MEG'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.

MEG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio6.5x
Fair PE Ratio6.9x

Price-To-Earnings vs Fair Ratio: MEG is expensive based on its Price-To-Earnings Ratio (6.9x) compared to the estimated Fair Price-To-Earnings Ratio (6.8x).


Share Price vs Fair Value

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

Below Fair Value: MEG (CA$21.73) is trading below our estimate of fair value (CA$42.6)

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


Analyst Price Targets

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

The above table shows the analyst MEG forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentCA$21.73
CA$23.43
+7.8%
16.4%CA$34.00CA$19.00n/a14
Jan ’24CA$18.85
CA$23.79
+26.2%
16.1%CA$34.00CA$18.00n/a14
Dec ’23CA$19.18
CA$24.14
+25.9%
14.8%CA$34.00CA$19.00n/a14
Nov ’23CA$20.44
CA$23.21
+13.6%
17.0%CA$34.00CA$18.00n/a14
Oct ’23CA$15.46
CA$23.96
+55.0%
16.0%CA$34.00CA$19.00n/a14
Sep ’23CA$17.58
CA$25.18
+43.2%
15.1%CA$34.00CA$19.00n/a14
Aug ’23CA$17.63
CA$25.18
+42.8%
14.7%CA$34.00CA$19.00n/a14
Jul ’23CA$17.82
CA$25.86
+45.1%
12.5%CA$34.00CA$22.00n/a14
Jun ’23CA$22.37
CA$25.07
+12.1%
14.2%CA$34.00CA$21.00n/a14
May ’23CA$19.30
CA$24.00
+24.4%
16.7%CA$34.00CA$19.00n/a14
Apr ’23CA$17.18
CA$21.93
+27.6%
9.5%CA$26.00CA$17.00n/a14
Mar ’23CA$16.63
CA$18.50
+11.2%
19.7%CA$26.00CA$13.00n/a15
Feb ’23CA$15.49
CA$17.30
+11.7%
18.6%CA$26.00CA$11.50n/a15
Jan ’23CA$11.70
CA$15.00
+28.2%
13.7%CA$20.00CA$11.50CA$18.8515
Dec ’22CA$10.36
CA$14.73
+42.2%
15.1%CA$20.00CA$11.50CA$19.1815
Nov ’22CA$11.28
CA$14.13
+25.2%
18.5%CA$20.00CA$9.00CA$20.4414
Oct ’22CA$9.89
CA$12.65
+27.9%
21.2%CA$20.00CA$9.00CA$15.4613
Sep ’22CA$7.92
CA$12.67
+59.9%
22.5%CA$20.00CA$9.00CA$17.5812
Aug ’22CA$7.96
CA$12.58
+58.0%
21.9%CA$20.00CA$9.00CA$17.6313
Jul ’22CA$8.97
CA$11.27
+25.6%
29.5%CA$20.00CA$5.25CA$17.8214
Jun ’22CA$8.62
CA$9.20
+6.7%
17.9%CA$12.00CA$5.25CA$22.3715
May ’22CA$6.79
CA$8.87
+30.6%
16.5%CA$11.00CA$5.25CA$19.3015
Apr ’22CA$6.64
CA$8.50
+28.0%
17.9%CA$10.50CA$5.25CA$17.1816
Mar ’22CA$6.43
CA$6.38
-0.9%
21.7%CA$9.00CA$4.00CA$16.6316
Feb ’22CA$4.57
CA$5.82
+27.3%
16.6%CA$7.50CA$4.00CA$15.4915
Jan ’22CA$4.45
CA$4.83
+8.6%
24.9%CA$7.50CA$2.50CA$11.7015

Analyst Forecast: Target price is less than 20% higher than the current share price.


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