uploads///valuation

Upstream Companies with the Lowest EBITDA Multiples

Keisha Bandz - Author
By

Nov. 20 2020, Updated 1:09 p.m. ET

Top five upstream stocks by EV-to-EBITDA

In this part, we’ll discuss the EV-to-adjusted EBITDA (earnings before interest, tax, depreciation, and amortization). The EV (enterprise value) is the sum of a company’s market capitalization and debt, less cash and cash equivalents. Let’s look at the top five upstream companies that are the cheapest when comparing the EV-to-adjusted EBITDA multiples.

Article continues below advertisement

sandridge Energy

As of the first quarter, Sandridge Energy’s (SD) EV-to-adjusted EBITDA ratio was ~2.77x. The company has a market capitalization of $529.83 million. As of March 31, the company didn’t have any debt. Sandridge Energy repaid its $36 million building note. The company’s trailing 12-month adjusted EBITDA as of the first quarter was $160 million. Sandridge Energy’s forward EV-to-EBITDA multiple is 3.2x. Analysts expect the company’s EBITDA to be lower this year compared to the last 12 months.

Gulfport Energy 

Gulfport Energy’s (GPOR) EV-to-adjusted EBITDA ratio as of the first quarter was ~4x. Currently, the company’s market capitalization is $1.91 billion. Gulfport Energy’s long-term debt as of March 31 was ~$2.94 billion. The company’s adjusted trailing 12-month EBITDA as of the first quarter was ~$887.7 million. Gulfport Energy’s forward EV-to-EBITDA multiple is 4.3x.

Article continues below advertisement

Stone Energy

Stone Energy’s (SGY) EV-to-adjusted EBITDA ratio as of the first quarter was ~4.1x. The company’s current market capitalization is $709.6 million. As of March 31, Stone Energy’s total outstanding debt was ~$235.39 million. The company’s trailing 12-month adjusted EBITDA for the 12 months as of the first quarter was $152.42 million.

On May 10, Talos Energy (TALO) announced the completion of the strategic combination between Talos Energy and Stone Energy.

Southwestern Energy

As of the first quarter, Southwestern Energy’s (SWN) EV-to-adjusted EBITDA ratio was ~4.9x. The debt makes up a considerable portion of Southwestern Energy’s enterprise value. The company has a market capitalization of $2.72 billion. As of March 31, the total debt was ~$4.4 billion. The company’s adjusted trailing 12-month EBITDA as of the first quarter is ~$1.25 billion. The company’s forward EV-to-EBITDA multiple is 4.5x. Analysts expect Southwestern Energy’s EBITDA to be higher this year compared to the last 12 months.

Murphy Oil

Murphy Oil’s (MUR) EV-to-adjusted EBITDA ratio as of the first quarter was ~5.30x. The current market capitalization is ~$5.55 billion, while the long-term debt as of March 31 was $2.9 billion. The adjusted trailing 12-month EBITDA as of the first quarter was $1.29 billion.

Murphy Oil has a forward EV-to-EBITDA multiple of 4.4x. The EBITDA could be higher this year compared to the last 12 months.

Next, we’ll discuss these companies’ stock performances.

Advertisement

Latest Murphy Oil Corp News and Updates

    © Copyright 2022 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.