Tourmaline Oil Corp (TOU:TSX) Analysts rate as Strong Buy, $75

STA Research
by: STA Research

Based on the Tourmaline Oil Corp stock forecasts from 9 analysts, the average analyst target price for Tourmaline Oil Corp is CAD 75.31 over the next 12 months. Tourmaline Oil Corp’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Tourmaline Oil Corp is Slightly Bullish, which is based on 9 positive signals and 7 negative signals. At the last closing, Tourmaline Oil Corp’s stock price was CAD 79.53. Tourmaline Oil Corp’s stock price has changed by +3.08% over the past week, +13.46% over the past month and +164.13% over the last year.

Last week, Stifel Nicolaus Research raised the target to $90.50 from $87.25, and kept the Buy rating intact.

TD Research downgraded to Hold from Buy, with a $80 target on the stock price.

In the Western Canadian Sedimentary Basin, Tourmaline Oil Corp. acquires, explores for, develops, and produces oil and natural gas resources. It owns holdings in the Alberta Deep Basin, the Northeast British Columbia Montney, and the Peace River High Triassic oil complex in British Columbia. The company was founded in 2008 and is based in Calgary, Alberta, Canada.

 

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk-adjusted returns

This stock has performed well, on a risk-adjusted basis, compared to its sector peers (for a hold period of at least 12 months) and is in the top quartile.

Low volatility

The stock’s annual returns have been stable and consistent compared to its sector peers (for a hold period of at least 12 months) and are in the top quartile. Although stability is good, also keep in mind it can limit returns.

Low debt

The company is less leveraged than its peers and is among the top quartile, which makes it more flexible. However, do check the news and look at its sector. Sometimes this is low because the company is not growing and has no growth potential.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Earnings Growth

Compared to its sector, this stock has shown top quartile earnings growth in the previous 5 years.

Superior Revenue Growth

Compared to its sector, this stock has shown top quartile revenue growth in the previous 5 years.

High Gross Profit to Asset Ratio

This stock is in the top quartile compared to its peers on Gross Profit to Asset Ratio. This is a popular measure among value investors for showing superior returns in the long run.

 

What we don’t like:

Below median dividend returns

The company’s average income yield over the past 5 years has been low compared to its peers. However, it is not a problem if you are not looking for income.

Overpriced compared to earnings

The stock is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced compared to book value

The stock is trading high compared to its peers median on a price to book value basis.

Overpriced on a cash flow basis

The stock is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.

Poor return on equity

The company management has delivered below median return on equity in the most recent 4 quarters compared to its peers.

Poor capital utilization

The company management has delivered below median return on invested capital in the most recent 4 quarters compared to its peers.

Poor return on assets

The company management has delivered below median return on assets in the most recent 4 quarters compared to its peers.

 

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