Equinor ASA engages in the exploration, production, transportation, refining, and marketing of petroleum and petroleum-derived products in Norway and internationally. The company was founded in 1972 and is based in Stavanger, Norway.
EQNR Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Equinor Asa with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Equinor Asa ranked in the 40th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. The most interesting components of our discounted cash flow analysis for Equinor Asa ended up being:
The company's compound free cash flow growth rate over the past 1.99 years comes in at -0.01%; that's greater than only 23.9% of US stocks we're applying DCF forecasting to.
Equinor Asa's weighted average cost of capital (WACC) is 7%; for context, that number is higher than just 4.19% of tickers in our DCF set.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than just 7.44% of stocks in its sector (Energy).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Energy that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as EQNR, try CRK, CLMT, RDS.A, TGA, and SDPI.
On September 29, 2020, Norwegian energy giant Equinor ASA (EQNR) announced that it made a discovery in the North Sea. While this discovery is not especially large, it does reinforce my earlier article that stated that the Norwegian oil story may not be over yet. Equinor still has some growth...
Equinor (EQNR) says it plans to cut its exploration staff by ~30% globally by 2023 to reduce costs, as the pandemic reduces demand for petroleum; the company had 21K total employees at year-end 2019.The company says the planned reduction will affect "hundreds of positions" by the end of 2022 both...
With me on the line in Oslo, we have Lars Christian Bacher, the CFO; and Svein Skeie, who is the Head of Performance Manager. With that, I'm delighted to pass straight over to Lars Christian to start the call.