EQUINOR ASA (EQNR.OL) Stock Fundamental Analysis
Europe - Euronext Oslo - OSL:EQNR - NO0010096985 - Common Stock
249 NOK
-0.7 (-0.28%)
EQNR gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 71 industry peers in the Oil, Gas & Consumable Fuels industry. EQNR scores excellent on profitability, but there are some minor concerns on its financial health. EQNR is cheap, but on the other hand it scores bad on growth. This makes EQNR very considerable for value investing!
1. Profitability
1.1 Basic Checks
- In the past year EQNR was profitable.
- EQNR had a positive operating cash flow in the past year.
- Of the past 5 years EQNR 4 years were profitable.
- EQNR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of EQNR (4.22%) is better than 61.97% of its industry peers.
- Looking at the Return On Equity, with a value of 14.13%, EQNR belongs to the top of the industry, outperforming 80.28% of the companies in the same industry.
- The Return On Invested Capital of EQNR (22.60%) is better than 98.59% of its industry peers.
- EQNR had an Average Return On Invested Capital over the past 3 years of 33.11%. This is significantly above the industry average of 8.91%.
- The last Return On Invested Capital (22.60%) for EQNR is well below the 3 year average (33.11%), which needs to be investigated, but indicates that EQNR had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.22% | ||
| ROE | 14.13% | ||
| ROIC | 22.6% |
ROA(3y)11.06%
ROA(5y)6.92%
ROE(3y)32.85%
ROE(5y)20.85%
ROIC(3y)33.11%
ROIC(5y)25.12%
1.3 Margins
- EQNR's Profit Margin of 5.35% is in line compared to the rest of the industry. EQNR outperforms 43.66% of its industry peers.
- In the last couple of years the Profit Margin of EQNR has grown nicely.
- EQNR has a Operating Margin of 27.99%. This is in the better half of the industry: EQNR outperforms 71.83% of its industry peers.
- In the last couple of years the Operating Margin of EQNR has grown nicely.
- EQNR's Gross Margin of 48.66% is in line compared to the rest of the industry. EQNR outperforms 52.11% of its industry peers.
- In the last couple of years the Gross Margin of EQNR has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.99% | ||
| PM (TTM) | 5.35% | ||
| GM | 48.66% |
OM growth 3Y-8.38%
OM growth 5Y5.28%
PM growth 3Y-3.8%
PM growth 5Y23.92%
GM growth 3Y-5.36%
GM growth 5Y-0.73%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so EQNR is creating value.
- The number of shares outstanding for EQNR has been reduced compared to 1 year ago.
- Compared to 5 years ago, EQNR has less shares outstanding
- EQNR has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.48 indicates that EQNR is not a great score, but indicates only limited risk for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 2.48, EQNR is in the better half of the industry, outperforming 64.79% of the companies in the same industry.
- The Debt to FCF ratio of EQNR is 4.56, which is a neutral value as it means it would take EQNR, 4.56 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of EQNR (4.56) is better than 64.79% of its industry peers.
- A Debt/Equity ratio of 0.62 indicates that EQNR is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.62, EQNR is not doing good in the industry: 60.56% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 4.56 | ||
| Altman-Z | 2.48 |
ROIC/WACC2.73
WACC8.27%
2.3 Liquidity
- EQNR has a Current Ratio of 1.23. This is a normal value and indicates that EQNR is financially healthy and should not expect problems in meeting its short term obligations.
- EQNR has a Current ratio (1.23) which is comparable to the rest of the industry.
- EQNR has a Quick Ratio of 1.12. This is a normal value and indicates that EQNR is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 1.12, EQNR is in the better half of the industry, outperforming 60.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.23 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
- EQNR shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -28.57%.
- EQNR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.82% yearly.
- Looking at the last year, EQNR shows a small growth in Revenue. The Revenue has grown by 2.15% in the last year.
- Measured over the past years, EQNR shows a quite strong growth in Revenue. The Revenue has been growing by 10.24% on average per year.
EPS 1Y (TTM)-28.57%
EPS 3Y-2.27%
EPS 5Y16.82%
EPS Q2Q%-53.16%
Revenue 1Y (TTM)2.15%
Revenue growth 3Y4.92%
Revenue growth 5Y10.24%
Sales Q2Q%2.14%
3.2 Future
- EQNR is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -0.02% yearly.
- Based on estimates for the next years, EQNR will show a decrease in Revenue. The Revenue will decrease by -4.76% on average per year.
EPS Next Y-17.83%
EPS Next 2Y-7.18%
EPS Next 3Y-2.2%
EPS Next 5Y-0.02%
Revenue Next Year0.77%
Revenue Next 2Y-4.32%
Revenue Next 3Y-2.5%
Revenue Next 5Y-4.76%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 11.01, which indicates a very decent valuation of EQNR.
- Compared to the rest of the industry, the Price/Earnings ratio of EQNR indicates a somewhat cheap valuation: EQNR is cheaper than 76.06% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of EQNR to the average of the S&P500 Index (27.25), we can say EQNR is valued rather cheaply.
- The Price/Forward Earnings ratio is 9.13, which indicates a very decent valuation of EQNR.
- 78.87% of the companies in the same industry are more expensive than EQNR, based on the Price/Forward Earnings ratio.
- EQNR is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.01 | ||
| Fwd PE | 9.13 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, EQNR is valued cheaper than 97.18% of the companies in the same industry.
- 80.28% of the companies in the same industry are more expensive than EQNR, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.32 | ||
| EV/EBITDA | 1.38 |
4.3 Compensation for Growth
- EQNR has an outstanding profitability rating, which may justify a higher PE ratio.
- EQNR's earnings are expected to decrease with -2.20% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.65
EPS Next 2Y-7.18%
EPS Next 3Y-2.2%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 6.01%, EQNR is a good candidate for dividend investing.
- EQNR's Dividend Yield is rather good when compared to the industry average which is at 5.24. EQNR pays more dividend than 83.10% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, EQNR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.01% |
5.2 History
- The dividend of EQNR is nicely growing with an annual growth rate of 24.62%!
Dividend Growth(5Y)24.62%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 101.05% of the earnings are spent on dividend by EQNR. This is not a sustainable payout ratio.
- The Dividend Rate of EQNR has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP101.05%
EPS Next 2Y-7.18%
EPS Next 3Y-2.2%
EQUINOR ASA / EQNR.OL FAQ
What is the ChartMill fundamental rating of EQUINOR ASA (EQNR.OL) stock?
ChartMill assigns a fundamental rating of 6 / 10 to EQNR.OL.
What is the valuation status of EQUINOR ASA (EQNR.OL) stock?
ChartMill assigns a valuation rating of 7 / 10 to EQUINOR ASA (EQNR.OL). This can be considered as Undervalued.
How profitable is EQUINOR ASA (EQNR.OL) stock?
EQUINOR ASA (EQNR.OL) has a profitability rating of 8 / 10.
What is the financial health of EQUINOR ASA (EQNR.OL) stock?
The financial health rating of EQUINOR ASA (EQNR.OL) is 5 / 10.
What is the expected EPS growth for EQUINOR ASA (EQNR.OL) stock?
The Earnings per Share (EPS) of EQUINOR ASA (EQNR.OL) is expected to decline by -17.83% in the next year.