NasdaqCM:FLMN

Stock Analysis Report

Executive Summary

Falcon Minerals Corporation acquires and owns mineral, royalty, and over-riding royalty interests in oil and natural gas properties in North America.

Rewards

Trading at 47.1% below its fair value

Earnings are forecast to grow 27.49% per year

Risk Analysis

Dividend of 8.63% is not well covered by earnings or forecast to be in the next 3 years

Profit margins (22.7%) are lower than last year (44.9%)



Snowflake Analysis

Good value with reasonable growth potential.

Share Price & News

How has Falcon Minerals's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FLMN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.2%

FLMN

1.9%

US Oil and Gas

0.7%

US Market


1 Year Return

-17.1%

FLMN

-9.2%

US Oil and Gas

18.2%

US Market

Return vs Industry: FLMN underperformed the US Oil and Gas industry which returned -9.2% over the past year.

Return vs Market: FLMN underperformed the US Market which returned 18.2% over the past year.


Shareholder returns

FLMNIndustryMarket
7 Day-3.2%1.9%0.7%
30 Day-2.1%-2.7%1.5%
90 Day-11.0%-2.8%5.0%
1 Year-9.1%-17.1%-5.8%-9.2%20.8%18.2%
3 Yearn/a-13.7%-21.6%45.2%35.8%
5 Yearn/a-8.1%-21.6%71.6%52.7%

Price Volatility Vs. Market

How volatile is Falcon Minerals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Falcon Minerals undervalued compared to its fair value and its price relative to the market?

47.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FLMN ($6.26) is trading below our estimate of fair value ($11.84)

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


Price To Earnings Ratio

PE vs Industry: FLMN is poor value based on its PE Ratio (15.5x) compared to the Oil and Gas industry average (9.7x).

PE vs Market: FLMN is good value based on its PE Ratio (15.5x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: FLMN is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: FLMN is overvalued based on its PB Ratio (2.2x) compared to the US Oil and Gas industry average (0.8x).


Next Steps

Future Growth

How is Falcon Minerals forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

27.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FLMN's forecast earnings growth (27.5% per year) is above the savings rate (1.7%).

Earnings vs Market: FLMN's earnings (27.5% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FLMN's revenue (10.9% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: FLMN's revenue (10.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Falcon Minerals performed over the past 5 years?

-33.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FLMN has high quality earnings.

Growing Profit Margin: FLMN's current net profit margins (22.7%) are lower than last year (44.9%).


Past Earnings Growth Analysis

Earnings Trend: FLMN's earnings have declined by -33.7% per year over the past 5 years.

Accelerating Growth: FLMN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FLMN had negative earnings growth (-58%) over the past year, making it difficult to compare to the Oil and Gas industry average (-15.6%).


Return on Equity

High ROE: FLMN's Return on Equity (16.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Falcon Minerals's financial position?


Financial Position Analysis

Short Term Liabilities: FLMN's short term assets ($11.9M) exceed its short term liabilities ($2.0M).

Long Term Liabilities: FLMN's short term assets ($11.9M) do not cover its long term liabilities ($38.5M).


Debt to Equity History and Analysis

Debt Level: FLMN's debt to equity ratio (15.1%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if FLMN's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: FLMN's debt is well covered by operating cash flow (177.2%).

Interest Coverage: FLMN's interest payments on its debt are well covered by EBIT (19.3x coverage).


Balance Sheet

Inventory Level: FLMN has a high level of physical assets or inventory.

Debt Coverage by Assets: FLMN's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

What is Falcon Minerals's current dividend yield, its reliability and sustainability?

8.63%

Current Dividend Yield


Dividend Yield vs Market

company8.6%marketbottom25%1.4%markettop25%3.7%industryaverage4.2%forecastin3Years11.3%

Current dividend yield vs market & industry

Notable Dividend: FLMN's dividend (8.63%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: FLMN's dividend (8.63%) is in the top 25% of dividend payers in the US market (3.7%)


Stability and Growth of Payments

Stable Dividend: Too early to tell whether FLMN's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if FLMN's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (179.4%), FLMN's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FLMN's dividends in 3 years are not forecast to be well covered by earnings (140.2% payout ratio).


Next Steps

Management

What is the CEO of Falcon Minerals's salary, the management and board of directors tenure and is there insider trading?

1.2yrs

Average management tenure


CEO

Daniel Herz (42yo)

1.3yrs

Tenure

US$166,667

Compensation

Mr. Daniel C. Herz is the Chief Executive Officer and President of Falcon Minerals Corp., since August 2018 and April 2017. He was the President of Osprey Energy Acquisition Corp. since April 2017. He serv ...


CEO Compensation Analysis

Compensation vs Market: Daniel's total compensation ($USD166.67K) is below average for companies of similar size in the US market ($USD1.67M).

Compensation vs Earnings: Insufficient data to compare Daniel's compensation with company performance.


Management Age and Tenure

1.2yrs

Average Tenure

42yo

Average Age

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


Board Age and Tenure

1.3yrs

Average Tenure

46yo

Average Age

Experienced Board: FLMN's board of directors are not considered experienced ( 1.3 years average tenure), which suggests a new board.


Insider Trading

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


Recent Insider Transactions

SellUS$766,92824 Oct 19
Hite Hedge Asset Management LLC
EntityCompany
Shares117,627
Max PriceUS$6.52
SellUS$195,33816 Oct 19
Hite Hedge Asset Management LLC
EntityCompany
Shares28,642
Max PriceUS$6.82
SellUS$1,241,85613 Sep 19
Hite Hedge Asset Management LLC
EntityCompany
Shares176,400
Max PriceUS$7.04
BuyUS$224,34909 Aug 19
Alan Hirshberg
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares35,611
Max PriceUS$6.30
SellUS$5,435,06009 Jul 19
Hite Hedge Asset Management LLC
EntityCompany
Shares647,031
Max PriceUS$8.40
BuyUS$240,00016 May 19
Alan Hirshberg
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares30,000
Max PriceUS$8.00
BuyUS$445,56507 Feb 19
Hite Hedge Asset Management LLC
EntityCompany
Shares54,130
Max PriceUS$8.25
BuyUS$489,74306 Feb 19
Hite Hedge Asset Management LLC
EntityCompany
Shares59,455
Max PriceUS$8.28
BuyUS$115,75013 Dec 18
Brian Frank
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares15,000
Max PriceUS$7.75

Ownership Breakdown

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


Management Team

  • Jeff Brotman (55yo)

    Chief Legal Officer & Secretary

    • Tenure: 0yrs
    • Compensation: US$116.67k
  • Daniel Herz (42yo)

    CEO & President

    • Tenure: 1.3yrs
    • Compensation: US$166.67k
  • Brian Begley

    Vice President of IR

    • Tenure: 0yrs
  • Stephen Pilatzke (40yo)

    Chief Accounting Officer

    • Tenure: 1.2yrs
  • Bryan Gunderson

    Chief Financial Officer

    • Tenure: 0.5yrs

Board Members

  • Ed Cohen (80yo)

    Vice Chairman

    • Tenure: 1.3yrs
    • Compensation: US$89.38k
  • Jonathan Cohen (48yo)

    Chairman

    • Tenure: 1.3yrs
    • Compensation: US$89.38k
  • Eric Liaw (38yo)

    Independent Director

    • Tenure: 0.7yrs
  • Brian Frank (45yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$35.75k
  • Al Hirshberg (58yo)

    Independent Director

    • Tenure: 0.7yrs
  • Adam Jenkins (35yo)

    Independent Director

    • Tenure: 1.3yrs
  • Steven Jones (46yo)

    Independent Director

    • Tenure: 2.2yrs
    • Compensation: US$35.75k
  • William Anderson (65yo)

    Independent Director

    • Tenure: 1.3yrs
    • Compensation: US$35.75k
  • Jonathan Hamilton (29yo)

    Independent Director

    • Tenure: 1.3yrs

Company Information

Falcon Minerals Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Falcon Minerals Corporation
  • Ticker: FLMN
  • Exchange: NasdaqCM
  • Founded:
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Implied Market Cap: US$540.630m
  • Market Cap: US$287.651m
  • Shares outstanding: 85.95m
  • Website: https://www.falconminerals.com

Number of Employees


Location

  • Falcon Minerals Corporation
  • 1845 Walnut Street
  • 10th Floor
  • Philadelphia
  • Pennsylvania
  • 19103
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FLMNNasdaqCM (Nasdaq Capital Market)YesClass A Common StockUSUSDAug 2018
2JTDB (Deutsche Boerse AG)YesClass A Common StockDEEURAug 2018

Biography

Falcon Minerals Corporation acquires and owns mineral, royalty, and over-riding royalty interests in oil and natural gas properties in North America. It owns interests covering approximately 256,000 gross  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 00:52
End of Day Share Price2019/12/09 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.