Gran Tierra Energy (NYSEAM:GTE) - Share price, News & Analysis

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

GTE ($1.21) is trading below our estimate of [[fair value]] ($5.11)

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

GTE Stock Overview

Gran Tierra Energy Inc., together with its subsidiaries, engages in the exploration and production of oil and gas properties in Colombia and Ecuador.

Rewards

Trading at 76.3% below our estimate of its fair value

Revenue is forecast to grow 13.78% per year

Became profitable this year

Risk Analysis

Has a high level of debt

Gran Tierra Energy Competitors

SandRidge Energy

NYSE:SD

US$586.3m

Sitio Royalties

NYSE:STR

US$2.0b

Ring Energy

NYSEAM:REI

US$304.1m

TransGlobe Energy

NasdaqCM:TGA

US$258.0m

Price History & Performance

Summary of all time highs, changes and price drops for Gran Tierra Energy
Historical stock prices
Current Share Price	US$1.21
52 Week High	US$2.15
52 Week Low	US$0.44
Beta	1.65
1 Month Change	-27.98%
3 Month Change	-22.93%
1 Year Change	63.54%
3 Year Change	-21.94%
5 Year Change	-44.75%
Change since IPO	19.80%

Shareholder Returns

	GTE	US Oil and Gas	US Market
7D	1.7%	0.07%	1.6%
1Y	63.5%	31.4%	-20.8%

Return vs Industry: GTE exceeded the US Oil and Gas industry which returned 37.9% over the past year.

Return vs Market: GTE exceeded the US Market which returned -20.4% over the past year.

Price Volatility

Is GTE's price volatile compared to industry and market?
GTE volatility
GTE Average Weekly Movement	12.2%
Oil and Gas Industry Average Movement	8.8%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	3.2%

Stable Share Price: GTE is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 12% a week.

Volatility Over Time: GTE's weekly volatility (12%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2003	319	Greg Guidry	https://www.grantierra.com

Gran Tierra Energy Inc., together with its subsidiaries, engages in the exploration and production of oil and gas properties in Colombia and Ecuador. As of December 31, 2021, it had total proved undeveloped reserves of 24.8 million barrels of oil equivalent in Colombia. The company was incorporated in 2003 and is headquartered in Calgary, Canada.

Gran Tierra Energy Fundamentals Summary

How do Gran Tierra Energy's earnings and revenue compare to its market cap?
GTE fundamental statistics
Market Cap	US$445.84m
Earnings (TTM)	US$94.02m
Revenue (TTM)	US$552.80m

4.7x

P/E Ratio

0.8x

P/S Ratio

Is GTE overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GTE income statement (TTM)
Revenue	US$552.80m
Cost of Revenue	US$148.75m
Gross Profit	US$404.05m
Other Expenses	US$310.03m
Earnings	US$94.02m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.26
Gross Margin	73.09%
Net Profit Margin	17.01%
Debt/Equity Ratio	197.4%

How did GTE perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

4/6

Valuation Score 4/6

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

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GTE. This is calculated by dividing GTE's market cap by their current preferred multiple.
What is GTE's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$445.84m

GTE 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	1.8x
Enterprise Value/EBITDA	3.2x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

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

GTE PE Ratio vs Peers

The above table shows the PE ratio for GTE vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	6.1x
SD SandRidge Energy	5x	n/a	US$586.3m
STR Sitio Royalties	6.5x	39.8%	US$2.0b
REI Ring Energy	10.3x	65.9%	US$304.1m
TGA TransGlobe Energy	2.6x	-107.6%	US$258.0m
GTE Gran Tierra Energy	4.7x	n/a	US$445.8m

Forward PE

Price-To-Earnings vs Peers: GTE is good value based on its Price-To-Earnings Ratio (4.7x) compared to the peer average (6.1x).

Price to Earnings Ratio vs Industry

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

Price-To-Earnings vs Industry: GTE is good value based on its Price-To-Earnings Ratio (4.7x) compared to the US Oil and Gas industry average (12x)

Price to Earnings Ratio vs Fair Ratio

What is GTE'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.

GTE PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	4.7x
Fair PE Ratio	n/a

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

Share Price vs Fair Value

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

Below Fair Value: GTE ($1.21) is trading below our estimate of fair value ($5.11)

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

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate GTE's PEG Ratio to determine if it is good value.

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Future Growth

How is Gran Tierra Energy forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

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

13.8%

Forecasted annual revenue growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if GTE's forecast earnings growth is above the savings rate (1.9%).

Earnings vs Market: Insufficient data to determine if GTE's earnings are forecast to grow faster than the US market

High Growth Earnings: Insufficient data to determine if GTE's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: GTE's revenue (13.8% per year) is forecast to grow faster than the US market (8.3% per year).

High Growth Revenue: GTE's revenue (13.8% 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 GTE's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has Gran Tierra Energy performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

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

-12.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GTE has high quality earnings.

Growing Profit Margin: GTE became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: GTE has become profitable over the past 5 years, growing earnings by -12.6% per year.

Accelerating Growth: GTE has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: GTE has become profitable in the last year, making it difficult to compare its past year earnings growth to the Oil and Gas industry (102.2%).

Return on Equity

High ROE: Whilst GTE's Return on Equity (29.59%) is high, this metric is skewed due to their high level of debt.

Discover strong past performing companies

Financial Health

How is Gran Tierra Energy's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

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

Financial Position Analysis

Short Term Liabilities: GTE's short term assets ($138.2M) do not cover its short term liabilities ($233.3M).

Long Term Liabilities: GTE's short term assets ($138.2M) do not cover its long term liabilities ($680.8M).

Debt to Equity History and Analysis

Debt Level: GTE's net debt to equity ratio (179%) is considered high.

Reducing Debt: GTE's debt to equity ratio has increased from 19.5% to 197.4% over the past 5 years.

Debt Coverage: GTE's debt is well covered by operating cash flow (48.9%).

Interest Coverage: GTE's interest payments on its debt are well covered by EBIT (3.2x coverage).

Balance Sheet

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Dividend

What is Gran Tierra Energy 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
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate GTE's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

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

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

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

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

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Management

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

6.0yrs

Average management tenure

CEO

Greg Guidry (65 yo)

7.08yrs

Tenure

US$2,674,229

Compensation

Mr. Gary Stephen Guidry, also known as Greg, P.Eng. has been the Chief Executive Officer and President of Gran Tierra Energy, Inc. since May 7, 2015 and has been its Director since May 2015. Mr. Guidry ser...

CEO Compensation Analysis

Compensation vs Market: Greg's total compensation ($USD2.67M) is about average for companies of similar size in the US market ($USD2.81M).

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

Leadership Team

Experienced Management: GTE's management team is seasoned and experienced (6 years average tenure).

Board Members

Experienced Board: GTE's board of directors are considered experienced (7.1 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	2022/06/29 00:00
End of Day Share Price	2022/06/29 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31