Saturn Oil & Gas (TSXV:SOIL) - Share price, News & Analysis

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

SOIL (CA$2.48) is trading below our estimate of [[fair value]] (CA$58.77)

SOIL fundamental analysis
Snowflake Score
Valuation	6/6
Future Growth	5/6
Past Performance	0/6
Financial Health	1/6
Dividends	0/6

SOIL Stock Overview

Saturn Oil & Gas Inc. engages in the acquisition, exploration, and development of petroleum and natural gas resource deposits in Canada.

Rewards

Trading at 95.8% below our estimate of its fair value

Earnings are forecast to grow 161.04% per year

Risk Analysis

Shareholders have been substantially diluted in the past year

Negative shareholders equity

Saturn Oil & Gas Competitors

Alvopetro Energy

TSXV:ALV

CA$238.8m

Southern Energy

TSXV:SOU

CA$127.8m

Petro-Victory Energy

TSXV:VRY

CA$32.3m

Hemisphere Energy

TSXV:HME

CA$167.9m

Price History & Performance

Summary of all time highs, changes and price drops for Saturn Oil & Gas
Historical stock prices
Current Share Price	CA$2.48
52 Week High	CA$4.49
52 Week Low	CA$1.88
Beta	1.77
1 Month Change	18.66%
3 Month Change	-11.11%
1 Year Change	-4.61%
3 Year Change	3.33%
5 Year Change	45.88%
Change since IPO	-31.11%

Shareholder Returns

	SOIL	CA Oil and Gas	CA Market
7D	8.8%	0.9%	1.3%
1Y	-4.6%	57.3%	3.3%

Return vs Industry: SOIL underperformed the Canadian Oil and Gas industry which returned 51.6% over the past year.

Return vs Market: SOIL underperformed the Canadian Market which returned 2.1% over the past year.

Price Volatility

Is SOIL's price volatile compared to industry and market?
SOIL volatility
SOIL Average Weekly Movement	8.9%
Oil and Gas Industry Average Movement	11.1%
Market Average Movement	10.5%
10% most volatile stocks in CA Market	18.9%
10% least volatile stocks in CA Market	4.2%

Stable Share Price: SOIL is not significantly more volatile than the rest of Canadian stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: SOIL's weekly volatility (9%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2001	68	John Jeffrey	https://www.saturnoil.com

Saturn Oil & Gas Inc. engages in the acquisition, exploration, and development of petroleum and natural gas resource deposits in Canada. It is involved in the exploration, development, and production of light oil assets in the Oxbow area of Southeast Saskatchewan, as well as Viking light oil assets and Success heavy oil assets in West-Central Saskatchewan. The company was formerly known as Saturn Minerals Inc. and changed its name to Saturn Oil & Gas Inc. in January 2017.

Saturn Oil & Gas Fundamentals Summary

How do Saturn Oil & Gas's earnings and revenue compare to its market cap?
SOIL fundamental statistics
Market Cap	CA$148.03m
Earnings (TTM)	-CA$161.15m
Revenue (TTM)	CA$157.24m

0.9x

P/S Ratio

-0.9x

P/E Ratio

Is SOIL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SOIL income statement (TTM)
Revenue	CA$157.24m
Cost of Revenue	CA$61.12m
Gross Profit	CA$96.13m
Other Expenses	CA$257.28m
Earnings	-CA$161.15m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-2.70
Gross Margin	61.13%
Net Profit Margin	-102.48%
Debt/Equity Ratio	-93.9%

How did SOIL perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

6/6

Valuation Score 6/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales 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 SOIL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SOIL. This is calculated by dividing SOIL's market cap by their current preferred multiple.
What is SOIL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CA$148.03m

SOIL 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	1.4x
Enterprise Value/EBITDA	-1.8x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does SOIL's PS Ratio compare to its peers?

SOIL PS Ratio vs Peers

The above table shows the PS ratio for SOIL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	8.9x
ALV Alvopetro Energy	4x	2.3%	CA$238.8m
SOU Southern Energy	5.6x	30.3%	CA$127.8m
VRY Petro-Victory Energy	22.8x	n/a	CA$32.3m
HME Hemisphere Energy	3x	n/a	CA$167.9m
SOIL Saturn Oil & Gas	0.9x	52.6%	CA$148.0m

Price-To-Sales vs Peers: SOIL is good value based on its Price-To-Sales Ratio (0.9x) compared to the peer average (8.9x).

Price to Earnings Ratio vs Industry

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

Price-To-Sales vs Industry: SOIL is good value based on its Price-To-Sales Ratio (0.9x) compared to the Canadian Oil and Gas industry average (2.2x)

Price to Sales Ratio vs Fair Ratio

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

SOIL PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.9x
Fair PS Ratio	4x

Price-To-Sales vs Fair Ratio: SOIL is good value based on its Price-To-Sales Ratio (0.9x) compared to the estimated Fair Price-To-Sales Ratio (4x).

Share Price vs Fair Value

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

Below Fair Value: SOIL (CA$2.48) is trading below our estimate of fair value (CA$58.77)

Significantly Below Fair Value: SOIL 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?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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Future Growth

How is Saturn Oil & Gas forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

161.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SOIL is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.6%).

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

High Growth Earnings: SOIL is expected to become profitable in the next 3 years.

Revenue vs Market: SOIL's revenue (52.6% per year) is forecast to grow faster than the Canadian market (6.6% per year).

High Growth Revenue: SOIL's revenue (52.6% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if SOIL's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has Saturn Oil & Gas performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-83.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SOIL is currently unprofitable.

Growing Profit Margin: SOIL is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: SOIL is unprofitable, and losses have increased over the past 5 years at a rate of 83.1% per year.

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

Earnings vs Industry: SOIL is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (158.3%).

Return on Equity

High ROE: SOIL's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.

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Financial Health

How is Saturn Oil & Gas's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: SOIL has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: SOIL has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.

Debt to Equity History and Analysis

Debt Level: SOIL has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: SOIL's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

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: SOIL has sufficient cash runway for 3 months based on last reported free cash flow, but has since raised additional capital.

Forecast Cash Runway: Insufficient data to determine if SOIL has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.

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Dividend

What is Saturn Oil & Gas's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate SOIL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate SOIL's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SOIL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SOIL's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as SOIL has not reported any payouts.

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Management

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

1.2yrs

Average management tenure

CEO

John Jeffrey

5.42yrs

Tenure

CA$217,099

Compensation

Mr. John Jeffrey, B.A., MBA, has been the Chief Financial Officer at RHC Capital Corp. since February 2018. Mr. Jeffrey has been Chief Executive Officer of Saturn Oil & Gas Inc. (formerly known as Saturn M...

CEO Compensation Analysis

Compensation vs Market: Insufficient data to establish whether John's total compensation is reasonable compared to companies of similar size in the Canadian market.

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

Leadership Team

Experienced Management: SOIL's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.

Board Members

Experienced Board: SOIL's board of directors are considered experienced (3.7 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: SOIL insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 137.4%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/18 00:00
End of Day Share Price	2022/08/18 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31