VAR ENERGI ASA (VAR.OL) Stock Fundamental Analysis
Europe - Euronext Oslo - OSL:VAR - NO0011202772 - Common Stock
34.645 NOK
+0.47 (+1.36%)
VAR gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 75 industry peers in the Oil, Gas & Consumable Fuels industry. While VAR has a great profitability rating, there are quite some concerns on its financial health. VAR is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
- In the past year VAR was profitable.
- In the past year VAR had a positive cash flow from operations.
- VAR had positive earnings in 4 of the past 5 years.
- Each year in the past 5 years VAR had a positive operating cash flow.
1.2 Ratios
- VAR has a worse Return On Assets (2.19%) than 64.00% of its industry peers.
- The Return On Equity of VAR (70.22%) is better than 98.67% of its industry peers.
- With an excellent Return On Invested Capital value of 10.78%, VAR belongs to the best of the industry, outperforming 85.33% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for VAR is significantly above the industry average of 8.82%.
- The 3 year average ROIC (22.49%) for VAR is well above the current ROIC(10.78%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.19% | ||
| ROE | 70.22% | ||
| ROIC | 10.78% |
ROA(3y)3.19%
ROA(5y)0.97%
ROE(3y)45.05%
ROE(5y)18.2%
ROIC(3y)22.49%
ROIC(5y)N/A
1.3 Margins
- VAR has a Profit Margin of 7.75%. This is comparable to the rest of the industry: VAR outperforms 56.00% of its industry peers.
- In the last couple of years the Profit Margin of VAR has grown nicely.
- Looking at the Operating Margin, with a value of 43.98%, VAR belongs to the top of the industry, outperforming 96.00% of the companies in the same industry.
- VAR's Operating Margin has improved in the last couple of years.
- VAR has a Gross Margin of 81.88%. This is amongst the best in the industry. VAR outperforms 89.33% of its industry peers.
- VAR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 43.98% | ||
| PM (TTM) | 7.75% | ||
| GM | 81.88% |
OM growth 3Y0.34%
OM growth 5Y18.33%
PM growth 3Y-26.93%
PM growth 5Y8.97%
GM growth 3Y-0.06%
GM growth 5Y3.92%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so VAR is creating value.
- Compared to 1 year ago, VAR has about the same amount of shares outstanding.
- Compared to 5 years ago, VAR has about the same amount of shares outstanding.
- The debt/assets ratio for VAR is higher compared to a year ago.
2.2 Solvency
- The Debt to FCF ratio of VAR is 7.35, which is on the high side as it means it would take VAR, 7.35 years of fcf income to pay off all of its debts.
- VAR's Debt to FCF ratio of 7.35 is in line compared to the rest of the industry. VAR outperforms 53.33% of its industry peers.
- A Debt/Equity ratio of 7.19 is on the high side and indicates that VAR has dependencies on debt financing.
- VAR has a worse Debt to Equity ratio (7.19) than 96.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 7.19 | ||
| Debt/FCF | 7.35 | ||
| Altman-Z | N/A |
ROIC/WACC1.27
WACC8.46%
2.3 Liquidity
- VAR has a Current Ratio of 0.72. This is a bad value and indicates that VAR is not financially healthy enough and could expect problems in meeting its short term obligations.
- VAR's Current ratio of 0.72 is on the low side compared to the rest of the industry. VAR is outperformed by 88.00% of its industry peers.
- VAR has a Quick Ratio of 0.72. This is a bad value and indicates that VAR is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Quick ratio of VAR (0.61) is worse than 86.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.72 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
- VAR shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -4.17%.
- VAR shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 31.78% yearly.
- The Revenue has been growing slightly by 1.05% in the past year.
- The Revenue has been growing by 20.92% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-4.17%
EPS 3Y-21.91%
EPS 5Y31.78%
EPS Q2Q%-28.57%
Revenue 1Y (TTM)1.05%
Revenue growth 3Y6.86%
Revenue growth 5Y20.92%
Sales Q2Q%14.4%
3.2 Future
- Based on estimates for the next years, VAR will show a very strong growth in Earnings Per Share. The EPS will grow by 28.39% on average per year.
- VAR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.56% yearly.
EPS Next Y296.31%
EPS Next 2Y82.35%
EPS Next 3Y49.44%
EPS Next 5Y28.39%
Revenue Next Year11.89%
Revenue Next 2Y10.59%
Revenue Next 3Y6.12%
Revenue Next 5Y2.56%
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 stable.
- 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
- With a Price/Earnings ratio of 15.26, VAR is valued correctly.
- Compared to the rest of the industry, the Price/Earnings ratio of VAR is on the same level as its industry peers.
- The average S&P500 Price/Earnings ratio is at 27.30. VAR is valued slightly cheaper when compared to this.
- The Price/Forward Earnings ratio is 9.58, which indicates a very decent valuation of VAR.
- Based on the Price/Forward Earnings ratio, VAR is valued a bit cheaper than the industry average as 77.33% of the companies are valued more expensively.
- VAR's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 24.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.26 | ||
| Fwd PE | 9.58 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VAR indicates a rather cheap valuation: VAR is cheaper than 89.33% of the companies listed in the same industry.
- 76.00% of the companies in the same industry are more expensive than VAR, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.28 | ||
| EV/EBITDA | 2.47 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- VAR has an outstanding profitability rating, which may justify a higher PE ratio.
- VAR's earnings are expected to grow with 49.44% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.05
PEG (5Y)0.48
EPS Next 2Y82.35%
EPS Next 3Y49.44%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 14.44%, VAR is a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 5.11, VAR pays a better dividend. On top of this VAR pays more dividend than 98.67% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, VAR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 14.44% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- VAR pays out 194.92% of its income as dividend. This is not a sustainable payout ratio.
DP194.92%
EPS Next 2Y82.35%
EPS Next 3Y49.44%
VAR ENERGI ASA / VAR.OL FAQ
What is the fundamental rating for VAR stock?
ChartMill assigns a fundamental rating of 5 / 10 to VAR.OL.
What is the valuation status for VAR stock?
ChartMill assigns a valuation rating of 8 / 10 to VAR ENERGI ASA (VAR.OL). This can be considered as Undervalued.
How profitable is VAR ENERGI ASA (VAR.OL) stock?
VAR ENERGI ASA (VAR.OL) has a profitability rating of 8 / 10.
What is the financial health of VAR ENERGI ASA (VAR.OL) stock?
The financial health rating of VAR ENERGI ASA (VAR.OL) is 1 / 10.
Can you provide the dividend sustainability for VAR stock?
The dividend rating of VAR ENERGI ASA (VAR.OL) is 5 / 10 and the dividend payout ratio is 194.92%.