TALOS ENERGY INC (TALO) Stock Fundamental Analysis
NYSE:TALO - New York Stock Exchange, Inc. - US87484T1088 - Common Stock - Currency: USD
TALO gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 213 industry peers in the Oil, Gas & Consumable Fuels industry. The financial health of TALO is average, but there are quite some concerns on its profitability. TALO has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year TALO was profitable.
TALO had a positive operating cash flow in the past year.
In multiple years TALO reported negative net income over the last 5 years.
In the past 5 years TALO always reported a positive cash flow from operatings.
1.2 Ratios
TALO has a Return On Assets of 0.43%. This is in the lower half of the industry: TALO underperforms 66.67% of its industry peers.
TALO's Return On Equity of 0.96% is on the low side compared to the rest of the industry. TALO is outperformed by 64.32% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.94%, TALO is doing worse than 70.42% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TALO is significantly below the industry average of 23.60%.
The 3 year average ROIC (10.34%) for TALO is well above the current ROIC(1.94%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.43% | ||
| ROE | 0.96% | ||
| ROIC | 1.94% |
ROA(3y)5.05%
ROA(5y)-1.58%
ROE(3y)12.9%
ROE(5y)-7.12%
ROIC(3y)10.34%
ROIC(5y)N/A
1.3 Margins
The Profit Margin of TALO (1.27%) is worse than 64.32% of its industry peers.
Looking at the Operating Margin, with a value of 6.52%, TALO is doing worse than 65.73% of the companies in the same industry.
TALO's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 72.79%, TALO belongs to the top of the industry, outperforming 83.57% of the companies in the same industry.
TALO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.52% | ||
| PM (TTM) | 1.27% | ||
| GM | 72.79% |
OM growth 3Y-44.48%
OM growth 5Y-25.79%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.5%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TALO is destroying value.
TALO has more shares outstanding than it did 1 year ago.
The number of shares outstanding for TALO has been increased compared to 5 years ago.
The debt/assets ratio for TALO has been reduced compared to a year ago.
2.2 Solvency
TALO has an Altman-Z score of 0.57. This is a bad value and indicates that TALO is not financially healthy and even has some risk of bankruptcy.
TALO's Altman-Z score of 0.57 is on the low side compared to the rest of the industry. TALO is outperformed by 64.32% of its industry peers.
TALO has a debt to FCF ratio of 2.10. This is a good value and a sign of high solvency as TALO would need 2.10 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.10, TALO belongs to the top of the industry, outperforming 83.10% of the companies in the same industry.
TALO has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of TALO (0.49) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.1 | ||
| Altman-Z | 0.57 |
ROIC/WACC0.18
WACC10.49%
2.3 Liquidity
TALO has a Current Ratio of 1.05. This is a normal value and indicates that TALO is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of TALO (1.05) is comparable to the rest of the industry.
TALO has a Quick Ratio of 1.05. This is a normal value and indicates that TALO is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.05, TALO is in line with its industry, outperforming 55.87% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.05 | ||
| Quick Ratio | 1.05 |
3. Growth
3.1 Past
TALO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -70.00%.
The Revenue has grown by 31.40% in the past year. This is a very strong growth!
The Revenue has been growing by 16.79% on average over the past years. This is quite good.
EPS 1Y (TTM)-70%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%146.15%
Revenue 1Y (TTM)31.4%
Revenue growth 3Y16.61%
Revenue growth 5Y16.79%
Sales Q2Q%19.33%
3.2 Future
Based on estimates for the next years, TALO will show a very negative growth in Earnings Per Share. The EPS will decrease by -53.79% on average per year.
TALO is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -1.98% yearly.
EPS Next Y-429.6%
EPS Next 2Y-185.11%
EPS Next 3Y-99.03%
EPS Next 5Y-53.79%
Revenue Next Year-7.98%
Revenue Next 2Y-5.56%
Revenue Next 3Y-4.21%
Revenue Next 5Y-1.98%
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 272.33, which means the current valuation is very expensive for TALO.
69.48% of the companies in the same industry are cheaper than TALO, based on the Price/Earnings ratio.
TALO is valuated expensively when we compare the Price/Earnings ratio to 26.43, which is the current average of the S&P500 Index.
TALO is expected to report negative earnings next year, which makes the Forward Price/Earnings Ratio negative.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 272.33 | ||
| Fwd PE | N/A |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TALO is valued cheaply inside the industry as 96.71% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, TALO is valued cheaply inside the industry as 96.71% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.27 | ||
| EV/EBITDA | 1.9 |
4.3 Compensation for Growth
A cheap valuation may be justified as TALO's earnings are expected to decrease with -99.03% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-185.11%
EPS Next 3Y-99.03%
5. Dividend
5.1 Amount
TALO does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
8.17
-0.25 (-2.97%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners69.52%
Inst Owner Change3.04%
Ins Owners0.56%
Ins Owner Change1.38%
Market Cap1.46B
Analysts81.11
Price Target12.95 (58.51%)
Short Float %11.78%
Short Ratio6.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)297.23%
Min EPS beat(2)163.52%
Max EPS beat(2)430.93%
EPS beat(4)3
Avg EPS beat(4)148.4%
Min EPS beat(4)-124.09%
Max EPS beat(4)430.93%
EPS beat(8)3
Avg EPS beat(8)50.57%
EPS beat(12)4
Avg EPS beat(12)21.11%
EPS beat(16)5
Avg EPS beat(16)-228.95%
Revenue beat(2)1
Avg Revenue beat(2)-1.16%
Min Revenue beat(2)-3.13%
Max Revenue beat(2)0.82%
Revenue beat(4)2
Avg Revenue beat(4)0.39%
Min Revenue beat(4)-3.13%
Max Revenue beat(4)4.03%
Revenue beat(8)3
Avg Revenue beat(8)-0.25%
Revenue beat(12)6
Avg Revenue beat(12)2.43%
Revenue beat(16)10
Avg Revenue beat(16)6.12%
PT rev (1m)-9.29%
PT rev (3m)-21.36%
EPS NQ rev (1m)-57.54%
EPS NQ rev (3m)-162.75%
EPS NY rev (1m)-1.66%
EPS NY rev (3m)-117.47%
Revenue NQ rev (1m)-3.69%
Revenue NQ rev (3m)-6.03%
Revenue NY rev (1m)-0.54%
Revenue NY rev (3m)-4.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 272.33 | ||
| Fwd PE | N/A | ||
| P/S | 0.71 | ||
| P/FCF | 2.27 | ||
| P/OCF | 1.29 | ||
| P/B | 0.53 | ||
| P/tB | 0.53 | ||
| EV/EBITDA | 1.9 |
EPS(TTM)0.03
EY0.37%
EPS(NY)-1.3
Fwd EYN/A
FCF(TTM)3.6
FCFY44.07%
OCF(TTM)6.36
OCFY77.8%
SpS11.52
BVpS15.3
TBVpS15.3
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.43% | ||
| ROE | 0.96% | ||
| ROCE | 2.46% | ||
| ROIC | 1.94% | ||
| ROICexc | 2.03% | ||
| ROICexgc | 2.03% | ||
| OM | 6.52% | ||
| PM (TTM) | 1.27% | ||
| GM | 72.79% | ||
| FCFM | 31.24% |
ROA(3y)5.05%
ROA(5y)-1.58%
ROE(3y)12.9%
ROE(5y)-7.12%
ROIC(3y)10.34%
ROIC(5y)N/A
ROICexc(3y)10.62%
ROICexc(5y)N/A
ROICexgc(3y)10.62%
ROICexgc(5y)N/A
ROCE(3y)13.08%
ROCE(5y)N/A
ROICexcg growth 3Y-52.56%
ROICexcg growth 5Y-27.88%
ROICexc growth 3Y-52.56%
ROICexc growth 5Y-27.88%
OM growth 3Y-44.48%
OM growth 5Y-25.79%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.5%
F-Score9
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.1 | ||
| Debt/EBITDA | 0.99 | ||
| Cap/Depr | 40.64% | ||
| Cap/Sales | 23.91% | ||
| Interest Coverage | 1 | ||
| Cash Conversion | 84.39% | ||
| Profit Quality | 2454.61% | ||
| Current Ratio | 1.05 | ||
| Quick Ratio | 1.05 | ||
| Altman-Z | 0.57 |
F-Score9
WACC10.49%
ROIC/WACC0.18
Cap/Depr(3y)63.27%
Cap/Depr(5y)68.41%
Cap/Sales(3y)28.24%
Cap/Sales(5y)34.26%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-70%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%146.15%
EPS Next Y-429.6%
EPS Next 2Y-185.11%
EPS Next 3Y-99.03%
EPS Next 5Y-53.79%
Revenue 1Y (TTM)31.4%
Revenue growth 3Y16.61%
Revenue growth 5Y16.79%
Sales Q2Q%19.33%
Revenue Next Year-7.98%
Revenue Next 2Y-5.56%
Revenue Next 3Y-4.21%
Revenue Next 5Y-1.98%
EBIT growth 1Y-42.18%
EBIT growth 3Y-35.26%
EBIT growth 5Y-13.32%
EBIT Next Year672.28%
EBIT Next 3Y90.66%
EBIT Next 5Y48.01%
FCF growth 1Y131.14%
FCF growth 3Y56.61%
FCF growth 5YN/A
OCF growth 1Y72.14%
OCF growth 3Y32.76%
OCF growth 5Y19.58%