TSX:OVV

Stock Analysis Report

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Market Cap

CA$9.9b

Last Updated

2021/06/24 02:51 UTC

Data Sources

Company Financials +

Executive Summary

Ovintiv Inc., together with its subsidiaries, engages in the exploration, development, production, and marketing of natural gas, oil, and natural gas liquids. More Details


Snowflake Analysis

Moderate growth potential with imperfect balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: OVV is not significantly more volatile than the rest of Canadian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: OVV's weekly volatility (7%) has been stable over the past year.


Market Performance


7 Day Return

-1.0%

OVV

-1.4%

CA Oil and Gas

-0.9%

CA Market


1 Year Return

202.1%

OVV

47.4%

CA Oil and Gas

36.1%

CA Market

Return vs Industry: OVV exceeded the Canadian Oil and Gas industry which returned 47.4% over the past year.

Return vs Market: OVV exceeded the Canadian Market which returned 36.1% over the past year.


Shareholder returns

OVVIndustryMarket
7 Day-1.0%-1.4%-0.9%
30 Day28.4%9.2%1.9%
90 Day27.4%15.4%6.2%
1 Year209.3%202.1%55.2%47.4%40.5%36.1%
3 Year-52.9%-56.8%1.4%-11.1%31.7%19.0%
5 Year-19.4%-26.8%9.1%-10.5%59.5%35.6%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

1.98x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: OVV (CA$38.52) is trading above our estimate of fair value (CA$21.18)

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


Price To Earnings Ratio

PE vs Industry: OVV is unprofitable, so we can't compare its PE Ratio to the Canadian Oil and Gas industry average.

PE vs Market: OVV is unprofitable, so we can't compare its PE Ratio to the Canadian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate OVV's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: OVV is overvalued based on its PB Ratio (2x) compared to the CA Oil and Gas industry average (1.6x).


Future Growth

How is Ovintiv forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

22.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: OVV is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.5%).

Earnings vs Market: OVV is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: OVV's is expected to become profitable in the next 3 years.

Revenue vs Market: OVV's revenue is expected to decline over the next 3 years (-1.7% per year).

High Growth Revenue: OVV's revenue is forecast to decline over the next 3 years (-1.7% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: OVV's Return on Equity is forecast to be low in 3 years time (17.5%).


Past Performance

How has Ovintiv performed over the past 5 years?

-27.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: OVV is currently unprofitable.

Growing Profit Margin: OVV is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: OVV is unprofitable, and losses have increased over the past 5 years at a rate of 27.7% per year.

Accelerating Growth: Unable to compare OVV's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: OVV is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (-33.9%).


Return on Equity

High ROE: OVV has a negative Return on Equity (-150.19%), as it is currently unprofitable.


Financial Health

How is Ovintiv's financial position?


Financial Position Analysis

Short Term Liabilities: OVV's short term assets ($1.2B) do not cover its short term liabilities ($3.5B).

Long Term Liabilities: OVV's short term assets ($1.2B) do not cover its long term liabilities ($6.9B).


Debt to Equity History and Analysis

Debt Level: OVV's debt to equity ratio (155.2%) is considered high.

Reducing Debt: OVV's debt to equity ratio has increased from 97.3% to 155.2% over the past 5 years.


Balance Sheet


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: Whilst unprofitable OVV has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: OVV is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 54.7% per year.


Dividend

What is Ovintiv current dividend yield, its reliability and sustainability?

1.20%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: OVV's dividend (1.2%) isn’t notable compared to the bottom 25% of dividend payers in the Canadian market (1.58%).

High Dividend: OVV's dividend (1.2%) is low compared to the top 25% of dividend payers in the Canadian market (4.5%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: OVV is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: OVV's dividends in 3 years are forecast to be thoroughly covered by earnings (8.4% payout ratio).


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Doug Suttles (59 yo)

8yrs

Tenure

US$11,183,487

Compensation

Mr. Douglas James Suttles, also known as Doug, has been the Chief Executive Officer of Ovintiv Inc. since June 10, 2013. Mr. Suttles served as President of Ovintiv Inc. since June 30, 2020 until December 1...


CEO Compensation Analysis

Compensation vs Market: Doug's total compensation ($USD11.18M) is above average for companies of similar size in the Canadian market ($USD3.93M).

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


Leadership Team

Experienced Management: OVV's management team is considered experienced (2.1 years average tenure).


Board Members

Experienced Board: OVV's board of directors are considered experienced (6.5 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: OVV insiders have only sold shares 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

Ovintiv Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ovintiv Inc.
  • Ticker: OVV
  • Exchange: TSX
  • Founded: 2020
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Market Cap: CA$9.866b
  • Shares outstanding: 261.08m
  • Website: https://www.ovintiv.com

Number of Employees


Location

  • Ovintiv Inc.
  • 370 17th Street
  • Suite 1700
  • Denver
  • Colorado
  • 80202
  • United States

Listings


Biography

Ovintiv Inc., together with its subsidiaries, engages in the exploration, development, production, and marketing of natural gas, oil, and natural gas liquids. It operates through USA Operations, Canadian O...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/06/24 02:51
End of Day Share Price2021/06/23 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


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.