PGS (OB:PGS) - Share price, News & Analysis

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

PGS (NOK6.92) is trading below our estimate of [[fair value]] (NOK47.29)

PGS fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	4/6
Past Performance	0/6
Financial Health	3/6
Dividends	0/6

PGS Stock Overview

PGS ASA, together with its subsidiaries, operates as a marine geophysical company primarily in Norway.

Rewards

Trading at 85.4% below our estimate of its fair value

Earnings are forecast to grow 94.34% per year

Earnings have grown 20.3% per year over the past 5 years

Risk Analysis

Highly volatile share price over the past 3 months

Shareholders have been substantially diluted in the past year

PGS Competitors

BW Offshore

OB:BWO

kr5.0b

Siem Offshore

OB:SIOFF

kr3.3b

Magseis Fairfield

OB:MSEIS

kr2.2b

Solstad Offshore

OB:SOFF

kr2.4b

Price History & Performance

Summary of all time highs, changes and price drops for PGS
Historical stock prices
Current Share Price	kr6.92
52 Week High	kr8.79
52 Week Low	kr1.26
Beta	3.25
1 Month Change	-13.12%
3 Month Change	16.99%
1 Year Change	61.68%
3 Year Change	-43.49%
5 Year Change	-57.15%
Change since IPO	-80.23%

Shareholder Returns

	PGS	NO Energy Services	NO Market
7D	3.9%	2.0%	-1.1%
1Y	61.7%	50.8%	9.2%

Return vs Industry: PGS exceeded the Norwegian Energy Services industry which returned 50.8% over the past year.

Return vs Market: PGS exceeded the Norwegian Market which returned 9.2% over the past year.

Price Volatility

Is PGS's price volatile compared to industry and market?
PGS volatility
PGS Average Weekly Movement	12.6%
Energy Services Industry Average Movement	8.9%
Market Average Movement	6.8%
10% most volatile stocks in NO Market	12.6%
10% least volatile stocks in NO Market	3.8%

Stable Share Price: PGS is more volatile than 90% of Norwegian stocks over the past 3 months, typically moving +/- 13% a week.

Volatility Over Time: PGS's weekly volatility has decreased from 18% to 13% over the past year, but is still higher than 75% of Norwegian stocks.

About the Company

Founded	Employees	CEO	Website
1991	839	Rune Pedersen	https://www.pgs.com

PGS ASA, together with its subsidiaries, operates as a marine geophysical company primarily in Norway. The company provides a range of seismic and reservoir services, including data acquisition, imaging, interpretation, and field evaluation to oil and gas companies. It also operates in the Asia Pacific, Canada, Egypt, the Americas, Angola, the United Kingdom, Ukraine, Brazil, South Africa, other African countries, the Middle East, and internationally.

PGS Fundamentals Summary

How do PGS's earnings and revenue compare to its market cap?
PGS fundamental statistics
Market Cap	US$460.32m
Earnings (TTM)	-US$144.70m
Revenue (TTM)	US$756.00m

0.6x

P/S Ratio

-3.2x

P/E Ratio

Is PGS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
PGS income statement (TTM)
Revenue	US$756.00m
Cost of Revenue	US$275.60m
Gross Profit	US$480.40m
Other Expenses	US$625.10m
Earnings	-US$144.70m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

Oct 20, 2022

Earnings per share (EPS)	-0.22
Gross Margin	63.54%
Net Profit Margin	-19.14%
Debt/Equity Ratio	344.5%

How did PGS perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is PGS 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
Analyst Forecast

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for PGS. This is calculated by dividing PGS's market cap by their current preferred multiple.
What is PGS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$460.32m

PGS 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	2x
Enterprise Value/EBITDA	3.6x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

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

PGS PS Ratio vs Peers

The above table shows the PS ratio for PGS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	0.8x
BWO BW Offshore	0.6x	-17.0%	kr5.0b
SIOFF Siem Offshore	1.3x	n/a	kr3.3b
MSEIS Magseis Fairfield	0.8x	7.3%	kr2.2b
SOFF Solstad Offshore	0.5x	n/a	kr2.4b
PGS PGS	0.6x	4.5%	kr4.5b

Price-To-Sales vs Peers: PGS is good value based on its Price-To-Sales Ratio (0.6x) compared to the peer average (0.8x).

Price to Earnings Ratio vs Industry

How does PGS's PE Ratio compare vs other companies in the NO Energy Services Industry?

Price-To-Sales vs Industry: PGS is good value based on its Price-To-Sales Ratio (0.6x) compared to the Norwegian Energy Services industry average (1.1x)

Price to Sales Ratio vs Fair Ratio

What is PGS'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.

PGS PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.6x
Fair PS Ratio	1.5x

Price-To-Sales vs Fair Ratio: PGS is good value based on its Price-To-Sales Ratio (0.6x) compared to the estimated Fair Price-To-Sales Ratio (1.5x).

Share Price vs Fair Value

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

Below Fair Value: PGS (NOK6.92) is trading below our estimate of fair value (NOK47.29)

Significantly Below Fair Value: PGS 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 lower than the current share price.

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Future Growth

How is PGS forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

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

94.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: PGS is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.1%).

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

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

Revenue vs Market: PGS's revenue (4.5% per year) is forecast to grow faster than the Norwegian market (-1% per year).

High Growth Revenue: PGS's revenue (4.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: PGS's Return on Equity is forecast to be low in 3 years time (17.9%).

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Past Performance

How has PGS 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

20.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: PGS is currently unprofitable.

Growing Profit Margin: PGS is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: PGS is unprofitable, but has reduced losses over the past 5 years at a rate of 20.3% per year.

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

Earnings vs Industry: PGS is unprofitable, making it difficult to compare its past year earnings growth to the Energy Services industry (-45.5%).

Return on Equity

High ROE: PGS has a negative Return on Equity (-43.53%), as it is currently unprofitable.

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Financial Health

How is PGS's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

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

Financial Position Analysis

Short Term Liabilities: PGS's short term assets ($566.1M) exceed its short term liabilities ($541.1M).

Long Term Liabilities: PGS's short term assets ($566.1M) do not cover its long term liabilities ($949.1M).

Debt to Equity History and Analysis

Debt Level: PGS's net debt to equity ratio (278.4%) is considered high.

Reducing Debt: PGS's debt to equity ratio has increased from 101.8% to 344.5% 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 PGS has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: PGS is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 43.6% per year.

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Dividend

What is PGS 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 PGS's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

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

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

Earnings Payout to Shareholders

Earnings Coverage: PGS is not paying a notable dividend for the Norwegian market.

Cash Payout to Shareholders

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

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Management

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

3.6yrs

Average management tenure

CEO

Rune Pedersen (52 yo)

4.92yrs

Tenure

US$805,496

Compensation

Mr. Rune Olav Pedersen has been President and Chief Executive Officer of PGS ASA (formerly known as Petroleum Geo-Services ASA) since September 1, 2017. Mr. Pedersen served as an Executive Vice President a...

CEO Compensation Analysis

Compensation vs Market: Rune's total compensation ($USD805.50K) is above average for companies of similar size in the Norwegian market ($USD576.08K).

Compensation vs Earnings: Rune's compensation has increased whilst the company is unprofitable.

Leadership Team

Experienced Management: PGS's management team is considered experienced (3.6 years average tenure).

Board Members

Experienced Board: PGS's board of directors are considered experienced (3.8 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 been substantially diluted in the past year, with total shares outstanding growing by 64.7%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/07 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31