OTCPK:TMKX.Y

Stock Analysis Report

Executive Summary

PAO TMK manufactures, sells, and exports steel pipes for the oil and gas industry.

Rewards

Trading at 69.9% below its fair value

Earnings are forecast to grow 41.22% per year

Became profitable this year

Risk Analysis

Interest payments are not well covered by earnings

Shares are highly illiquid

Unstable dividend track record

Large one-off items impacting financial results



Snowflake Analysis

Undervalued average dividend payer.


Similar Companies

Share Price & News

How has PAO TMK's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-64.9%

TMKX.Y

-6.0%

US Energy Services

7.2%

US Market


1 Year Return

-46.9%

TMKX.Y

-72.2%

US Energy Services

-10.4%

US Market

Return vs Industry: TMKX.Y exceeded the US Energy Services industry which returned -72.2% over the past year.

Return vs Market: TMKX.Y underperformed the US Market which returned -10.4% over the past year.


Shareholder returns

TMKX.YIndustryMarket
7 Day-64.9%-6.0%7.2%
30 Day-47.2%-50.5%-12.6%
90 Dayn/a-66.5%-19.4%
1 Year-45.1%-46.9%-71.3%-72.2%-8.5%-10.4%
3 Year-65.6%-67.9%-80.1%-82.9%15.8%8.3%
5 Year-42.6%-49.4%-81.4%-84.8%35.8%21.0%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is PAO TMK 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: TMKX.Y ($1.7) is trading below our estimate of fair value ($5.64)

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


Price To Earnings Ratio

PE vs Industry: TMKX.Y is good value based on its PE Ratio (5x) compared to the Energy Services industry average (8.8x).

PE vs Market: TMKX.Y is good value based on its PE Ratio (5x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: TMKX.Y is good value based on its PEG Ratio (0.1x)


Price to Book Ratio

PB vs Industry: TMKX.Y is overvalued based on its PB Ratio (0.6x) compared to the US Energy Services industry average (0.3x).


Next Steps

Future Growth

How is PAO TMK forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

41.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TMKX.Y's forecast earnings growth (41.2% per year) is above the savings rate (1.7%).

Earnings vs Market: TMKX.Y's earnings (41.2% per year) are forecast to grow faster than the US market (12.2% per year).

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

Revenue vs Market: TMKX.Y's revenue (0.6% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: TMKX.Y's revenue (0.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TMKX.Y's Return on Equity is forecast to be low in 3 years time (13.1%).


Next Steps

Past Performance

How has PAO TMK performed over the past 5 years?

50.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TMKX.Y has a large one-off loss of $105.9M impacting its December 31 2019 financial results.

Growing Profit Margin: TMKX.Y became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: TMKX.Y has become profitable over the past 5 years, growing earnings by 50.9% per year.

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

Earnings vs Industry: TMKX.Y has become profitable in the last year, making it difficult to compare its past year earnings growth to the Energy Services industry (-34.4%).


Return on Equity

High ROE: TMKX.Y's Return on Equity (12%) is considered low.


Next Steps

Financial Health

How is PAO TMK's financial position?


Financial Position Analysis

Short Term Liabilities: TMKX.Y's short term assets ($3.4B) exceed its short term liabilities ($2.7B).

Long Term Liabilities: TMKX.Y's short term assets ($3.4B) exceed its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: TMKX.Y's debt to equity ratio (360.8%) is considered high.

Reducing Debt: TMKX.Y's debt to equity ratio has increased from 249.5% to 360.8% over the past 5 years.


Balance Sheet

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

Debt Coverage by Assets: TMKX.Y's debt is covered by short term assets (assets are 1.1x debt).


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: TMKX.Y is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: TMKX.Y is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

What is PAO TMK's current dividend yield, its reliability and sustainability?

6.34%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TMKX.Y's dividend (6.34%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: TMKX.Y's dividend (6.34%) is in the top 25% of dividend payers in the US market (5.4%)


Stability and Growth of Payments

Stable Dividend: TMKX.Y has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: TMKX.Y's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (37.2%), TMKX.Y's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TMKX.Y's dividends in 3 years are forecast to be well covered by earnings (26.8% payout ratio).


Next Steps

Management

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

6.5yrs

Average management tenure


CEO

Igor Korytko (45yo)

0.67

Tenure

Mr. Igor Korytko has been the Chief Executive Officer and Chairman of the Management Board at PAO TMK since June 22, 2019. Mr. Korytko was the Vice President for Efficiency Management at PAO TMK until June ...


Leadership Team

NamePositionTenureCompensationOwnership
Igor Korytko
Chairman of the Management Board & CEO0.67yrno datano data
Tigran Petrosyan
Deputy CEO for Economy & Finance and Member of Management Board12.83yrsno data0.0016% $8.2k
Vladimir Oborsky
First Deputy CEO12.67yrsno data0.00075% $3.8k
Vyacheslav Popkov
Senior VP2.83yrsno data0.0015% $7.7k
Zimin Andrey Anatolyevich
Deputy CEO for Legal Issues & Member of Management Boardno datano data0.000070% $358.1
Sergey Chikalov
Member of Management Board0.67yrno datano data
Elena Pozolotina
VP of Human Resources & Member of Management Boardno datano datano data
Elena Verbinskaya
Chief Accounting Officer10.17yrsno datano data
Marina Badudina
Head of Strategic Investment Analysis and Investor Relationsno datano datano data
Sergey Alekseev
Marketing Directorno datano datano data

6.5yrs

Average Tenure

48yo

Average Age

Experienced Management: TMKX.Y's management team is seasoned and experienced (6.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Andrey Kaplunov
Executive Director15.17yrsno data0.0067% $34.3k
Anatoly Chubais
Non-Executive Director4.67yrsno datano data
Alexander Shokhin
Independent Director11.67yrsno datano data
Dmitry Pumpyanskiy
Chairman15.17yrsno data0.0063% $32.3k
Alexander Shiryaev
Director15.17yrsno data0.015% $76.9k
Alexander Pumpyanskiy
Director2.67yrsno datano data
Sergey Kravchenko
Independent Director3.67yrsno datano data
Yaroslav Kuzminov
Independent Director1.67yrsno datano data
Mikhail Khodorovsky
Director0.67yrno datano data
Natalia Chervonenko
Director0.67yrno datano data

4.2yrs

Average Tenure

60.5yo

Average Age

Experienced Board: TMKX.Y's board of directors are considered experienced (4.2 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.


Top Shareholders

Company Information

PAO TMK's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PAO TMK
  • Ticker: TMKX.Y
  • Exchange: OTCPK
  • Founded: 2001
  • Industry: Oil and Gas Equipment and Services
  • Sector: Energy
  • Market Cap: US$511.524m
  • Shares outstanding: 257.82m
  • Website: https://www.tmk-group.com

Location

  • PAO TMK
  • Building 2A
  • 40/2a Pokrovka Street
  • Moscow
  • 105062
  • Russia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TMKSLSE (London Stock Exchange)YesGDR EACH REPR 4 ORD SHS 'REGS'GBUSDOct 2006
N9E1DB (Deutsche Boerse AG)YesGDR EACH REPR 4 ORD SHS 'REGS'DEEUROct 2006
TMKO.YOTCPK (Pink Sheets LLC)YesGDR EACH REPR 4 ORD SHS 'REGS'USUSDOct 2006
TRMKMISX (Micex - Rts)Ordinary SharesRURUBNov 2006
TMKX.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDJan 2010

Biography

PAO TMK manufactures, sells, and exports steel pipes for the oil and gas industry. The company operates in three segments: Russia, Americas, and Europe. It offers seamless and welded threaded drill pipes, and casing and tubing that are used in drilling, equipping, and operating oil and gas wells; and oil and gas line pipes for intra-field to transport crude oil and natural gas from the field to oil refineries and storage facilities, as well as to shipment points and distribution nodes. The company also provides seamless industrial pipes for chemical, petrochemical, food, and nuclear industries, as well as for the production of steam boilers, bearings, and various machine parts and components; welded industrial pipes for engineering, construction, housing, and utilities sector; welded large diameter pipe for the construction of oil and gas trunk pipelines, oil field pipelines, general purpose pipelines, and pipelines for heat supply networks and nuclear power stations; and pipes with premium connections for oil and gas wells, including offshore, deep-sea, and the Far North locations, as well as for horizontal and directional wells. In addition, it offers oilfield services; and services in heat treating, protective coating, premium connections threading, warehousing, and pipe repairing. Further, it supplies scrap to steel plants, which includes collection, processing, and distribution of ferrous scrap and procurement services. The company also serves energy and machine-building, construction and municipal housing, shipbuilding, aviation and aerospace, and agriculture industries. PAO TMK was founded in 2001 and is based in Moscow, Russia. PAO TMK is a subsidiary of TMK Steel Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/31 03:14
End of Day Share Price2020/03/30 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.