Reconnaissance Energy Africa Valuation

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

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

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

Below Fair Value: Insufficient data to calculate REC's fair value for valuation analysis.

Significantly Below Fair Value: Insufficient data to calculate REC's fair value for valuation analysis.

Key Valuation Metric

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

Key metric: As REC is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for REC. This is calculated by dividing REC's market cap by their current earnings.
What is REC's PE Ratio?
PE Ratio	4x
Earnings	CA$63.44m
Market Cap	CA$257.60m

REC 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	n/a
Enterprise Value/EBITDA	-11.3x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for REC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	11.2x
SNM ShaMaran Petroleum	2.6x	40.8%	CA$255.2m
RKH Rockhopper Exploration	7.4x	-81.6%	UK£85.0m
LOU Lucero Energy	6.6x	n/a	CA$258.3m
PHX PHX Minerals	28.2x	89.3%	US$139.1m
REC Reconnaissance Energy Africa	4x	n/a	R257.6m

Price-To-Earnings vs Peers: REC is good value based on its Price-To-Earnings Ratio (4x) compared to the peer average (11.2x).

Price to Earnings Ratio vs Industry

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

27 Companies	Price / Earnings	Estimated Growth	Market Cap

27 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: REC is good value based on its Price-To-Earnings Ratio (4x) compared to the Global Oil and Gas industry average (10.4x).

Price to Earnings Ratio vs Fair Ratio

What is REC'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.

REC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	4x
Fair PE Ratio	n/a

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

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 REC forecast and predictions for the stock price in 12 month’s time.
Date	Share Price	Average 1Y Price Target	Dispersion	High	Low	1Y Actual price	Analysts
Current	R12.48	R30.24 +142.3%	12.7%	R35.48	R26.36	n/a	3
Nov ’25	n/a	R30.87 0%	12.3%	R35.93	R26.79	n/a	3
Oct ’25	n/a	R32.14 0%	12.3%	R37.56	R28.17	n/a	3
Sep ’25	n/a	R32.14 0%	12.3%	R37.56	R28.17	n/a	3
Aug ’25	n/a	R34.06 0%	9.5%	R37.28	R30.83	n/a	2
Jul ’25	n/a	R27.78 0%	34.5%	R37.67	R14.83	n/a	3
Jun ’25	n/a	R27.58 0%	34.3%	R37.29	R14.75	n/a	3
May ’25	n/a	R30.11 0%	29.5%	R38.99	R21.22	n/a	2

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