Enerplus Corporation engages in the exploration and development of crude oil and natural gas in the United States and Canada. The company was founded in 1986 and is based in Calgary, Canada.
ERF Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for ENERPLUS Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that ENERPLUS Corp ranked in the 15th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. As for the metrics that stood out in our discounted cash flow analysis of ENERPLUS Corp, consider:
The company's compound free cash flow growth rate over the past 5.01 years comes in at -0.18%; that's greater than only 8.99% of US stocks we're applying DCF forecasting to.
ENERPLUS Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -5.25. This coverage rate is greater than that of merely 12.21% of stocks we're observing for the purpose of forecasting via discounted cash flows.
As a business, ENERPLUS Corp experienced a tax rate of about 0% over the past twelve months; relative to its sector (Energy), this tax rate is higher than merely 0% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of ENERPLUS Corp? See BP, CHKAQ, CEO, XEC, and HLX.
Here's why investors with a higher risk exposure can look to bet on energy stocks such as Enerplus (TSX:ERF). The post 2 Wildcard TSX Energy Stocks That Could Gain Up to 60% From Current Prices appeared first on The Motley Fool Canada .