SDX Energy (AIM:SDX) - Share price, News & Analysis

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

SDX (£0.1) is trading below our estimate of [[fair value]] (£0.16)

SDX fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	3/6
Past Performance	0/6
Financial Health	6/6
Dividends	0/6

SDX Stock Overview

SDX Energy plc engages in the exploration, development, and production of oil and gas in the Arab Republic of Egypt and the Kingdom of Morocco.

Rewards

Trading at 36.7% below our estimate of its fair value

Earnings are forecast to grow 37.44% per year

Risk Analysis

Does not have a meaningful market cap (£21M)

SDX Energy Competitors

Europa Oil & Gas (Holdings)

AIM:EOG

UK£22.5m

Egdon Resources

AIM:EDR

UK£24.2m

Reabold Resources

AIM:RBD

UK£24.1m

Pennpetro Energy

LSE:PPP

UK£13.2m

Price History & Performance

Summary of all time highs, changes and price drops for SDX Energy
Historical stock prices
Current Share Price	UK£0.10
52 Week High	UK£0.16
52 Week Low	UK£0.07
Beta	1.54
1 Month Change	15.56%
3 Month Change	38.67%
1 Year Change	-33.97%
3 Year Change	-45.97%
5 Year Change	-78.05%
Change since IPO	-49.88%

Shareholder Returns

	SDX	GB Oil and Gas	GB Market
7D	14.3%	0.6%	-1.1%
1Y	-34.0%	1.9%	-9.7%

Return vs Industry: SDX underperformed the UK Oil and Gas industry which returned 1.9% over the past year.

Return vs Market: SDX underperformed the UK Market which returned -9.7% over the past year.

Price Volatility

Is SDX's price volatile compared to industry and market?
SDX volatility
SDX Average Weekly Movement	6.5%
Oil and Gas Industry Average Movement	8.6%
Market Average Movement	5.4%
10% most volatile stocks in GB Market	10.6%
10% least volatile stocks in GB Market	2.8%

Stable Share Price: SDX is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: SDX's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2019	64	Mark Reid	https://www.sdxenergygroup.com

SDX Energy plc engages in the exploration, development, and production of oil and gas in the Arab Republic of Egypt and the Kingdom of Morocco. The company has 50% working interest in Meseda and Rabul fields in the West Gharib, Egypt; 55% interest in the South Disouq concession located in the Nile Delta region, Egypt; and 75% working interest in four exploration permits consisting of Sebou Central, Gharb Occidental, Lalla Mimouna Nord, and Moulay Bouchta Ouest concessions situated in the Gharb Basin, Morocco. The company was incorporated in 2019 and is headquartered in London, the United Kingdom.

SDX Energy Fundamentals Summary

How do SDX Energy's earnings and revenue compare to its market cap?
SDX fundamental statistics
Market Cap	US$25.59m
Earnings (TTM)	-US$24.72m
Revenue (TTM)	US$51.71m

0.5x

P/S Ratio

-1.0x

P/E Ratio

Is SDX overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SDX income statement (TTM)
Revenue	US$51.71m
Cost of Revenue	US$9.19m
Gross Profit	US$42.53m
Other Expenses	US$67.24m
Earnings	-US$24.72m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-0.12
Gross Margin	82.23%
Net Profit Margin	-47.80%
Debt/Equity Ratio	0%

How did SDX perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

5/6

Valuation Score 5/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SDX. This is calculated by dividing SDX's market cap by their current preferred multiple.
What is SDX's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$25.59m

SDX 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	0.4x
Enterprise Value/EBITDA	0.6x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

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

SDX PS Ratio vs Peers

The above table shows the PS ratio for SDX vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	68.8x
EOG Europa Oil & Gas (Holdings)	7.4x	43.4%	UK£22.5m
EDR Egdon Resources	7.5x	21.0%	UK£24.2m
RBD Reabold Resources	22.5x	-25.6%	UK£24.1m
PPP Pennpetro Energy	237.8x	n/a	UK£13.2m
SDX SDX Energy	0.5x	-29.5%	UK£21.3m

Forward PS

Price-To-Sales vs Peers: SDX is good value based on its Price-To-Sales Ratio (0.5x) compared to the peer average (68.8x).

Price to Earnings Ratio vs Industry

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

Price-To-Sales vs Industry: SDX is good value based on its Price-To-Sales Ratio (0.5x) compared to the UK Oil and Gas industry average (1.8x)

Price to Sales Ratio vs Fair Ratio

What is SDX'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.

SDX PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.5x
Fair PS Ratio	1.6x

Price-To-Sales vs Fair Ratio: SDX is good value based on its Price-To-Sales Ratio (0.5x) compared to the estimated Fair Price-To-Sales Ratio (1.6x).

Share Price vs Fair Value

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

Below Fair Value: SDX (£0.1) is trading below our estimate of fair value (£0.16)

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

Price to Earnings Growth Ratio

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

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Future Growth

How is SDX Energy forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

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

37.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SDX is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (0.9%).

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

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

Revenue vs Market: SDX's revenue is expected to decline over the next 3 years (-29.5% per year).

High Growth Revenue: SDX's revenue is forecast to decline over the next 3 years (-29.5% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SDX is forecast to be unprofitable in 3 years.

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Past Performance

How has SDX Energy 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

-66.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SDX is currently unprofitable.

Growing Profit Margin: SDX is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: SDX is unprofitable, and losses have increased over the past 5 years at a rate of 66% per year.

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

Earnings vs Industry: SDX is unprofitable, making it difficult to compare its past year earnings growth to the Oil and Gas industry (377.8%).

Return on Equity

High ROE: SDX has a negative Return on Equity (-32.39%), as it is currently unprofitable.

Discover strong past performing companies

Financial Health

How is SDX Energy's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

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

Financial Position Analysis

Short Term Liabilities: SDX's short term assets ($39.7M) exceed its short term liabilities ($14.3M).

Long Term Liabilities: SDX's short term assets ($39.7M) exceed its long term liabilities ($7.0M).

Debt to Equity History and Analysis

Debt Level: SDX is debt free.

Reducing Debt: SDX had no debt 5 years ago.

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 SDX has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: SDX is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 28.7% per year.

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Dividend

What is SDX Energy 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
Future Dividend Coverage

Dividend Yield vs Market

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

High Dividend: Unable to evaluate SDX'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 SDX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SDX'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 SDX has not reported any payouts.

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Management

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

4.1yrs

Average board tenure

CEO

Mark Reid (54 yo)

2.67yrs

Tenure

US$439,161

Compensation

Mr. Mark Reid has been Chief Executive officer at SDX Energy plc since November 12, 2019 and its Executive Director since September 26, 2016. He serves as Secretary at SDX Energy plc. He served as Chief Fi...

CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD439.16K) is about average for companies of similar size in the UK market ($USD344.95K).

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

Board Members

Experienced Board: SDX's board of directors are considered experienced (4.1 years average tenure).

Ownership

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

Insider Trading Volume

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

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/03 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31