NYSE:PE

Stock Analysis Report

Executive Summary

Parsley Energy, Inc., an independent oil and natural gas company, engages in the acquisition, development, exploration, production, and sale of crude oil and natural gas properties in the Permian Basin in west Texas and Southeastern New Mexico.

Rewards

Trading at 58.2% below its fair value

Earnings are forecast to grow 28.98% per year

Risk Analysis

Highly volatile share price over past 3 months

Profit margins (14%) are lower than last year (21.7%)

Shareholders have been diluted in the past year



Snowflake Analysis

Undervalued with reasonable growth potential.


Similar Companies

Share Price & News

How has Parsley Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PE's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

2.2%

PE

-1.0%

US Oil and Gas

-1.4%

US Market


1 Year Return

-17.2%

PE

-13.4%

US Oil and Gas

14.5%

US Market

Return vs Industry: PE underperformed the US Oil and Gas industry which returned -13.4% over the past year.

Return vs Market: PE underperformed the US Market which returned 14.5% over the past year.


Shareholder returns

PEIndustryMarket
7 Day2.2%-1.0%-1.4%
30 Day-7.6%-5.2%1.3%
90 Day-10.1%-0.6%4.6%
1 Year-17.1%-17.2%-10.2%-13.4%17.1%14.5%
3 Year-57.2%-57.3%-13.3%-21.2%45.1%35.7%
5 Year35.1%34.8%-10.9%-24.2%67.1%48.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Parsley Energy undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PE ($15.52) is trading below our estimate of fair value ($37.15)

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


Price To Earnings Ratio

PE vs Industry: PE is poor value based on its PE Ratio (16.3x) compared to the Oil and Gas industry average (9.9x).

PE vs Market: PE is good value based on its PE Ratio (16.3x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: PE is good value based on its PB Ratio (0.8x) compared to the US Oil and Gas industry average (0.8x).


Next Steps

Future Growth

How is Parsley Energy forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

29.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PE's forecast earnings growth (29% per year) is above the savings rate (1.7%).

Earnings vs Market: PE's earnings (29% 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: PE's revenue (17.3% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: PE's revenue (17.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PE's Return on Equity is forecast to be low in 3 years time (10.4%).


Next Steps

Past Performance

How has Parsley Energy performed over the past 5 years?

55.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PE has high quality earnings.

Growing Profit Margin: PE's current net profit margins (14%) are lower than last year (21.7%).


Past Earnings Growth Analysis

Earnings Trend: PE has become profitable over the past 5 years, growing earnings by 55.8% per year.

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

Earnings vs Industry: PE had negative earnings growth (-27.4%) over the past year, making it difficult to compare to the Oil and Gas industry average (-15.6%).


Return on Equity

High ROE: PE's Return on Equity (4.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Parsley Energy's financial position?


Financial Position Analysis

Short Term Liabilities: PE's short term assets ($451.6M) do not cover its short term liabilities ($809.7M).

Long Term Liabilities: PE's short term assets ($451.6M) do not cover its long term liabilities ($2.6B).


Debt to Equity History and Analysis

Debt Level: PE's debt to equity ratio (33.5%) is considered satisfactory.

Reducing Debt: PE's debt to equity ratio has reduced from 60.3% to 33.5% over the past 5 years.

Debt Coverage: PE's debt is well covered by operating cash flow (57.4%).

Interest Coverage: PE's interest payments on its debt are well covered by EBIT (4x coverage).


Balance Sheet

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

Debt Coverage by Assets: PE's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Parsley Energy's current dividend yield, its reliability and sustainability?

0.77%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Parsley Energy before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company0.8%marketbottom25%1.4%markettop25%3.7%industryaverage4.2%forecastin3Years0.7%

Current dividend yield vs market & industry

Notable Dividend: PE's dividend (0.77%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: PE's dividend (0.77%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

Stable Dividend: PE is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: PE is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: PE is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of PE's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

3.9yrs

Average management tenure


CEO

Matt Gallagher (37yo)

0.9yrs

Tenure

US$3,885,232

Compensation

Mr. Matthew Gallagher, also known as Matt, has been Chief Executive Officer of Parsley Energy, Inc. since January 1, 2019. Mr. Gallagher has been President of Parsley Energy, Inc. since January 5, 2017 and ...


CEO Compensation Analysis

Compensation vs Market: Matt's total compensation ($USD3.89M) is about average for companies of similar size in the US market ($USD5.10M).

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


Management Age and Tenure

3.9yrs

Average Tenure

41yo

Average Age

Experienced Management: PE's management team is considered experienced (3.9 years average tenure).


Board Age and Tenure

3.4yrs

Average Tenure

56yo

Average Age

Experienced Board: PE's board of directors are considered experienced (3.4 years average tenure).


Insider Trading

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


Recent Insider Transactions

BuyUS$74,75002 Dec 19
Ronald Brokmeyer
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$14.95
BuyUS$34,73806 Jun 19
Jerry Windlinger
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,985
Max PriceUS$17.50
SellUS$2,024,21022 May 19
Bryan Sheffield
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares100,000
Max PriceUS$20.24
SellUS$65,55906 Mar 19
Colin Roberts
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares3,500
Max PriceUS$18.73
SellUS$769,02901 Mar 19
Michael Hinson
EntityIndividual
Role
Top Key Executive
Co-Founder & Senior VP of Corporate Development
Shares41,727
Max PriceUS$18.43
SellUS$5,567,07401 Mar 19
Bryan Sheffield
EntityIndividual
Role
Chairman of the Board
Founder & Executive Chairman
Shares305,000
Max PriceUS$18.25

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.3%.


Management Team

  • Ryan Dalton (40yo)

    Executive VP & CFO

    • Tenure: 6yrs
    • Compensation: US$2.72m
  • Kyle Rhodes

    Vice President of Investor Relations

    • Tenure: 0yrs
  • Bryan Sheffield (41yo)

    Founder & Executive Chairman

    • Tenure: 2.9yrs
    • Compensation: US$5.04m
  • Colin Roberts (41yo)

    Executive VP

    • Tenure: 6.7yrs
    • Compensation: US$1.86m
  • Matt Gallagher (37yo)

    President

    • Tenure: 0.9yrs
    • Compensation: US$3.89m
  • Paul Treadwell (52yo)

    Co-Founder & Senior VP of Production Operations

    • Tenure: 2.9yrs
  • Mike Hinson (51yo)

    Co-Founder & Senior VP of Corporate Development

    • Tenure: 11.9yrs
    • Compensation: US$1.37m
  • Cecilia Camarillo

    Senior Vice President of Accounting

    • Tenure: 3.9yrs
  • Jody Jordan

    Vice President of Marketing

    • Tenure: 1.8yrs
  • David Dell'Osso (41yo)

    Executive VP & COO

    • Tenure: 1.2yrs
    • Compensation: US$2.59m

Board Members

  • Ray Alameddine (72yo)

    Lead Director

    • Tenure: 0yrs
    • Compensation: US$293.63k
  • Jerry Windlinger (67yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$246.13k
  • Karen Hughes (62yo)

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: US$255.58k
  • Bryan Sheffield (41yo)

    Founder & Executive Chairman

    • Tenure: 2.9yrs
    • Compensation: US$5.04m
  • Bill Browning (65yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$272.93k
  • Matt Gallagher (37yo)

    President

    • Tenure: 0.9yrs
    • Compensation: US$3.89m
  • David Smith (49yo)

    Independent Director

    • Tenure: 6yrs
    • Compensation: US$258.63k
  • Hemang Desai (53yo)

    Independent Director

    • Tenure: 5.4yrs
    • Compensation: US$246.13k
  • Ron Brokmeyer (56yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$246.13k

Company Information

Parsley Energy, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Parsley Energy, Inc.
  • Ticker: PE
  • Exchange: NYSE
  • Founded: 2008
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Implied Market Cap: US$4.759b
  • Market Cap: US$4.227b
  • Shares outstanding: 316.66m
  • Website: https://www.parsleyenergy.com

Number of Employees


Location

  • Parsley Energy, Inc.
  • 303 Colorado Street
  • Suite 3000
  • Austin
  • Texas
  • 78701
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PENYSE (New York Stock Exchange)YesClass A Common StockUSUSDMay 2014
17PADB (Deutsche Boerse AG)YesClass A Common StockDEEURMay 2014
PE *BMV (Bolsa Mexicana de Valores)YesClass A Common StockMXMXNMay 2014

Biography

Parsley Energy, Inc., an independent oil and natural gas company, engages in the acquisition, development, exploration, production, and sale of crude oil and natural gas properties in the Permian Basin in  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/06 00:40
End of Day Share Price2019/12/05 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.