Petron Malaysia Refining & Marketing Bhd (KLSE:PETRONM) - Share price, News & Analysis

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

PETRONM (MYR4.73) is trading above our estimate of [[fair value]] (MYR2.38)

PETRONM fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	0/6
Past Performance	1/6
Financial Health	4/6
Dividends	3/6

PETRONM Stock Overview

Petron Malaysia Refining & Marketing Bhd engages in manufacturing and marketing of petroleum products in Peninsular Malaysia.

Rewards

Price-To-Earnings ratio (5.3x) is below the MY market (14.4x)

Risk Analysis

Earnings have declined by 23.2% per year over past 5 years

High level of non-cash earnings

Dividend of 4.23% is not well covered by earnings

Volatile share price over the past 3 months

Petron Malaysia Refining & Marketing Bhd Competitors

Hengyuan Refining Company Berhad

KLSE:HENGYUAN

RM1.2b

PETRONAS Dagangan Berhad

KLSE:PETDAG

RM22.3b

Hibiscus Petroleum Berhad

KLSE:HIBISCS

RM1.7b

Bumi Armada Berhad

KLSE:ARMADA

RM2.2b

Price History & Performance

Summary of all time highs, changes and price drops for Petron Malaysia Refining & Marketing Bhd
Historical stock prices
Current Share Price	RM4.73
52 Week High	RM7.73
52 Week Low	RM4.05
Beta	1.1
1 Month Change	4.65%
3 Month Change	-19.97%
1 Year Change	14.53%
3 Year Change	-16.58%
5 Year Change	-46.25%
Change since IPO	-23.71%

Recent News & Updates

Jun 25

We Think Petron Malaysia Refining & Marketing Bhd (KLSE:PETRONM) Is Taking Some Risk With Its Debt

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

May 29

Petron Malaysia Refining & Marketing Bhd's (KLSE:PETRONM) Upcoming Dividend Will Be Larger Than Last Year's

Petron Malaysia Refining & Marketing Bhd ( KLSE:PETRONM ) will increase its dividend on the 8th of July to RM0.20...

Shareholder Returns

	PETRONM	MY Oil and Gas	MY Market
7D	-8.0%	-1.2%	0.5%
1Y	14.5%	17.8%	-3.1%

Return vs Industry: PETRONM underperformed the MY Oil and Gas industry which returned 17.8% over the past year.

Return vs Market: PETRONM exceeded the MY Market which returned -3.1% over the past year.

Price Volatility

Is PETRONM's price volatile compared to industry and market?
PETRONM volatility
PETRONM Average Weekly Movement	9.5%
Oil and Gas Industry Average Movement	7.6%
Market Average Movement	5.6%
10% most volatile stocks in MY Market	11.5%
10% least volatile stocks in MY Market	2.8%

Stable Share Price: PETRONM is more volatile than 75% of MY stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: PETRONM's weekly volatility (9%) has been stable over the past year, but is still higher than 75% of MY stocks.

About the Company

Founded	Employees	CEO	Website
1893	599	Lubin Nepomuceno	https://www.petron.com.my

Petron Malaysia Refining & Marketing Bhd engages in manufacturing and marketing of petroleum products in Peninsular Malaysia. It offers a range of petroleum products, which include gasoline, diesel, aviation fuel, lubricants, greases, and other products, as well as liquefied petroleum gas to residential and commercial customers. The company was founded in 1893 and is based in Kuala Lumpur, Malaysia.

Petron Malaysia Refining & Marketing Bhd Fundamentals Summary

How do Petron Malaysia Refining & Marketing Bhd's earnings and revenue compare to its market cap?
PETRONM fundamental statistics
Market Cap	RM1.28b
Earnings (TTM)	RM241.85m
Revenue (TTM)	RM10.98b

5.3x

P/E Ratio

0.1x

P/S Ratio

Is PETRONM overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
PETRONM income statement (TTM)
Revenue	RM10.98b
Cost of Revenue	RM10.42b
Gross Profit	RM564.82m
Other Expenses	RM322.97m
Earnings	RM241.85m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.90
Gross Margin	5.14%
Net Profit Margin	2.20%
Debt/Equity Ratio	44.9%

How did PETRONM perform over the long term?

See historical performance and comparison

Dividends

4.2%

Current Dividend Yield

22%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

2/6

Valuation Score 2/6

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 PETRONM?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for PETRONM. This is calculated by dividing PETRONM's market cap by their current preferred multiple.
What is PETRONM's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	RM1.28b

PETRONM 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	0.2x
Enterprise Value/EBITDA	4.2x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

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

PETRONM PE Ratio vs Peers

The above table shows the PE ratio for PETRONM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	16.6x
HENGYUAN Hengyuan Refining Company Berhad	10.9x	n/a	RM1.2b
PETDAG PETRONAS Dagangan Berhad	48.7x	15.4%	RM22.3b
HIBISCS Hibiscus Petroleum Berhad	3.7x	18.3%	RM1.7b
ARMADA Bumi Armada Berhad	3.1x	2.7%	RM2.2b
PETRONM Petron Malaysia Refining & Marketing Bhd	5.3x	n/a	RM1.3b

Price-To-Earnings vs Peers: PETRONM is good value based on its Price-To-Earnings Ratio (5.3x) compared to the peer average (16.6x).

Price to Earnings Ratio vs Industry

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

Price-To-Earnings vs Industry: PETRONM is good value based on its Price-To-Earnings Ratio (5.3x) compared to the MY Oil and Gas industry average (10.9x)

Price to Earnings Ratio vs Fair Ratio

What is PETRONM'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.

PETRONM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	5.3x
Fair PE Ratio	n/a

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

Share Price vs Fair Value

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

Below Fair Value: PETRONM (MYR4.73) is trading above our estimate of fair value (MYR2.38)

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

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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Future Growth

How is Petron Malaysia Refining & Marketing Bhd forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

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

-2.7%

Forecasted Energy industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Petron Malaysia Refining & Marketing Bhd has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

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Examine Petron Malaysia Refining & Marketing Bhd's financial health to determine how well-positioned it is against times of financial stress by looking at its level of debt over time and how much cash it has left.

Past Performance

How has Petron Malaysia Refining & Marketing Bhd performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

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

-23.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: PETRONM has a high level of non-cash earnings.

Growing Profit Margin: PETRONM's current net profit margins (2.2%) are lower than last year (2.8%).

Past Earnings Growth Analysis

Earnings Trend: PETRONM's earnings have declined by 23.2% per year over the past 5 years.

Accelerating Growth: PETRONM's earnings growth over the past year (39.5%) exceeds its 5-year average (-23.2% per year).

Earnings vs Industry: PETRONM earnings growth over the past year (39.5%) underperformed the Oil and Gas industry 39.5%.

Return on Equity

High ROE: PETRONM's Return on Equity (11.7%) is considered low.

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Financial Health

How is Petron Malaysia Refining & Marketing Bhd's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: PETRONM's short term assets (MYR2.7B) exceed its short term liabilities (MYR2.6B).

Long Term Liabilities: PETRONM's short term assets (MYR2.7B) exceed its long term liabilities (MYR201.8M).

Debt to Equity History and Analysis

Debt Level: PETRONM's net debt to equity ratio (36.8%) is considered satisfactory.

Reducing Debt: PETRONM's debt to equity ratio has increased from 19.6% to 44.9% over the past 5 years.

Debt Coverage: PETRONM's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: PETRONM's interest payments on its debt are well covered by EBIT (24.7x coverage).

Balance Sheet

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Dividend

What is Petron Malaysia Refining & Marketing Bhd current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

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

4.23%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: PETRONM's dividend (4.23%) is higher than the bottom 25% of dividend payers in the MY market (2%).

High Dividend: PETRONM's dividend (4.23%) is low compared to the top 25% of dividend payers in the MY market (4.84%).

Stability and Growth of Payments

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

Growing Dividend: PETRONM's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (22.3%), PETRONM's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: PETRONM is paying a dividend but the company has no free cash flows.

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Management

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

8.8yrs

Average management tenure

CEO

Lubin Nepomuceno (71 yo)

8.75yrs

Tenure

Mr. Lubin B. Nepomuceno has been the Chief Executive Officer of Petron Malaysia Refining & Marketing Bhd since November 20, 2013. Mr. Nepomuceno has been General Manager of Petron Corporation since Februar...

Leadership Team

Experienced Management: PETRONM's management team is seasoned and experienced (8.8 years average tenure).

Board Members

Experienced Board: PETRONM's board of directors are considered experienced (9 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/08/07 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31