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DIVERSIFIED ENERGY CO PLC (DEC) Stock Fundamental Analysis

NYSE:DEC - New York Stock Exchange, Inc. - GB00BQHP5P93 - Common Stock - Currency: USD

14.02  -0.36 (-2.5%)

After market: 13.9101 -0.11 (-0.78%)

Fundamental Rating

4

Overall DEC gets a fundamental rating of 4 out of 10. We evaluated DEC against 211 industry peers in the Oil, Gas & Consumable Fuels industry. While DEC is still in line with the averages on profitability rating, there are concerns on its financial health. DEC is not valued too expensively and it also shows a decent growth rate.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

In the past year DEC was profitable.
DEC had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: DEC reported negative net income in multiple years.
Each year in the past 5 years DEC had a positive operating cash flow.
DEC Yearly Net Income VS EBIT VS OCF VS FCFDEC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 500M -500M 1B

1.2 Ratios

DEC's Return On Assets of 3.75% is on the low side compared to the rest of the industry. DEC is outperformed by 60.29% of its industry peers.
With an excellent Return On Equity value of 26.70%, DEC belongs to the best of the industry, outperforming 83.82% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 0.40%, DEC is doing worse than 80.88% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for DEC is significantly below the industry average of 28.75%.
The last Return On Invested Capital (0.40%) for DEC is well below the 3 year average (16.53%), which needs to be investigated, but indicates that DEC had better years and this may not be a problem.
Industry RankSector Rank
ROA 3.75%
ROE 26.7%
ROIC 0.4%
ROA(3y)-1.27%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)16.53%
ROIC(5y)11.16%
DEC Yearly ROA, ROE, ROICDEC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 100 200 300 400

1.3 Margins

The Profit Margin of DEC (19.09%) is better than 64.71% of its industry peers.
In the last couple of years the Profit Margin of DEC has grown nicely.
With a Operating Margin value of 2.22%, DEC is not doing good in the industry: 78.92% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of DEC has declined.
DEC's Gross Margin of 14.88% is on the low side compared to the rest of the industry. DEC is outperformed by 70.10% of its industry peers.
DEC's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 2.22%
PM (TTM) 19.09%
GM 14.88%
OM growth 3Y17.6%
OM growth 5Y-21.13%
PM growth 3YN/A
PM growth 5Y4.7%
GM growth 3Y3.04%
GM growth 5Y-13.5%
DEC Yearly Profit, Operating, Gross MarginsDEC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20 -20 40 60 80 100

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2

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DEC is still creating some value.
DEC has more shares outstanding than it did 1 year ago.
The number of shares outstanding for DEC has been reduced compared to 5 years ago.
DEC has a better debt/assets ratio than last year.
DEC Yearly Shares OutstandingDEC Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M
DEC Yearly Total Debt VS Total AssetsDEC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B

2.2 Solvency

DEC has an Altman-Z score of 0.02. This is a bad value and indicates that DEC is not financially healthy and even has some risk of bankruptcy.
DEC's Altman-Z score of 0.02 is on the low side compared to the rest of the industry. DEC is outperformed by 72.55% of its industry peers.
The Debt to FCF ratio of DEC is 10.68, which is on the high side as it means it would take DEC, 10.68 years of fcf income to pay off all of its debts.
DEC has a Debt to FCF ratio (10.68) which is comparable to the rest of the industry.
A Debt/Equity ratio of 2.75 is on the high side and indicates that DEC has dependencies on debt financing.
DEC's Debt to Equity ratio of 2.75 is on the low side compared to the rest of the industry. DEC is outperformed by 89.22% of its industry peers.
Industry RankSector Rank
Debt/Equity 2.75
Debt/FCF 10.68
Altman-Z 0.02
ROIC/WACC0.04
WACC9.22%
DEC Yearly LT Debt VS Equity VS FCFDEC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M 400M 600M 800M 1B

2.3 Liquidity

DEC has a Current Ratio of 0.44. This is a bad value and indicates that DEC is not financially healthy enough and could expect problems in meeting its short term obligations.
DEC has a Current ratio of 0.44. This is amonst the worse of the industry: DEC underperforms 91.18% of its industry peers.
DEC has a Quick Ratio of 0.44. This is a bad value and indicates that DEC is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of DEC (0.44) is worse than 88.73% of its industry peers.
Industry RankSector Rank
Current Ratio 0.44
Quick Ratio 0.44
DEC Yearly Current Assets VS Current LiabilitesDEC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B

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4

3. Growth

3.1 Past

The earnings per share for DEC have decreased strongly by -85.74% in the last year.
Measured over the past years, DEC shows a very strong growth in Earnings Per Share. The EPS has been growing by 98.32% on average per year.
The Revenue for DEC has decreased by -49.11% in the past year. This is quite bad
DEC shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.54% yearly.
EPS 1Y (TTM)-85.74%
EPS 3YN/A
EPS 5Y98.32%
EPS Q2Q%-97.64%
Revenue 1Y (TTM)-49.11%
Revenue growth 3Y28.55%
Revenue growth 5Y24.54%
Sales Q2Q%-24.34%

3.2 Future

Based on estimates for the next years, DEC will show a small growth in Earnings Per Share. The EPS will grow by 6.25% on average per year.
The Revenue is expected to decrease by -1.74% on average over the next years.
EPS Next Y-44.03%
EPS Next 2Y-11.7%
EPS Next 3Y3.55%
EPS Next 5Y6.25%
Revenue Next Year-16.68%
Revenue Next 2Y6.26%
Revenue Next 3Y7.46%
Revenue Next 5Y-1.74%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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.
DEC Yearly Revenue VS EstimatesDEC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 500M 1B 1.5B
DEC Yearly EPS VS EstimatesDEC Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 0 2 4 6

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6

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 4.70, which indicates a rather cheap valuation of DEC.
Based on the Price/Earnings ratio, DEC is valued cheaply inside the industry as 88.73% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of DEC to the average of the S&P500 Index (29.63), we can say DEC is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 7.14, the valuation of DEC can be described as very cheap.
DEC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. DEC is cheaper than 79.41% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. DEC is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 4.7
Fwd PE 7.14
DEC Price Earnings VS Forward Price EarningsDEC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

DEC's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, DEC is valued cheaply inside the industry as 87.25% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 4.52
EV/EBITDA 9.83
DEC Per share dataDEC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)0.05
EPS Next 2Y-11.7%
EPS Next 3Y3.55%

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6

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 7.98%, DEC is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 6.67, DEC pays a better dividend. On top of this DEC pays more dividend than 81.86% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.27, DEC pays a better dividend.
Industry RankSector Rank
Dividend Yield 7.98%

5.2 History

The dividend of DEC is nicely growing with an annual growth rate of 110.67%!
DEC has been paying a dividend for over 5 years, so it has already some track record.
As DEC did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)110.67%
Div Incr Years5
Div Non Decr Years5
DEC Yearly Dividends per shareDEC Yearly Dividends per shareYearly Dividends per share 2019 2020 2021 2022 2023 2024 2025 0.5 1 1.5

5.3 Sustainability

97.12% of the earnings are spent on dividend by DEC. This is not a sustainable payout ratio.
DEC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP97.12%
EPS Next 2Y-11.7%
EPS Next 3Y3.55%
DEC Yearly Income VS Free CF VS DividendDEC Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M -200M 400M -400M 600M -600M
DEC Dividend Payout.DEC Dividend Payout, showing the Payout Ratio.DEC Dividend Payout.PayoutRetained Earnings

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DIVERSIFIED ENERGY CO PLC

NYSE:DEC (2/21/2025, 8:13:35 PM)

After market: 13.9101 -0.11 (-0.78%)

14.02

-0.36 (-2.5%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)N/A N/A
Earnings (Next)03-17 2025-03-17/amc
Inst Owners75.84%
Inst Owner Change0%
Ins Owners4.42%
Ins Owner ChangeN/A
Market Cap719.23M
Analysts84.29
Price Target30.93 (120.61%)
Short Float %2.25%
Short Ratio4.41
Dividend
Industry RankSector Rank
Dividend Yield 7.98%
Yearly Dividend3.78
Dividend Growth(5Y)110.67%
DP97.12%
Div Incr Years5
Div Non Decr Years5
Ex-Date02-27 2025-02-27 (0.29)
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)8.96%
PT rev (3m)8.09%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-48.7%
EPS NY rev (3m)-48.7%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-3.33%
Valuation
Industry RankSector Rank
PE 4.7
Fwd PE 7.14
P/S 0.96
P/FCF 4.52
P/OCF 1.81
P/B 1.34
P/tB 1.38
EV/EBITDA 9.83
EPS(TTM)2.98
EY21.26%
EPS(NY)1.96
Fwd EY14%
FCF(TTM)3.1
FCFY22.1%
OCF(TTM)7.77
OCFY55.39%
SpS14.61
BVpS10.45
TBVpS10.14
PEG (NY)N/A
PEG (5Y)0.05
Profitability
Industry RankSector Rank
ROA 3.75%
ROE 26.7%
ROCE 0.53%
ROIC 0.4%
ROICexc 0.4%
ROICexgc 0.4%
OM 2.22%
PM (TTM) 19.09%
GM 14.88%
FCFM 21.2%
ROA(3y)-1.27%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)16.53%
ROIC(5y)11.16%
ROICexc(3y)16.58%
ROICexc(5y)11.19%
ROICexgc(3y)16.7%
ROICexgc(5y)11.26%
ROCE(3y)21.76%
ROCE(5y)14.69%
ROICexcg growth 3Y36.57%
ROICexcg growth 5Y-13.72%
ROICexc growth 3Y36.68%
ROICexc growth 5Y-13.84%
OM growth 3Y17.6%
OM growth 5Y-21.13%
PM growth 3YN/A
PM growth 5Y4.7%
GM growth 3Y3.04%
GM growth 5Y-13.5%
F-Score4
Asset Turnover0.2
Health
Industry RankSector Rank
Debt/Equity 2.75
Debt/FCF 10.68
Debt/EBITDA 6
Cap/Depr 104.67%
Cap/Sales 31.94%
Interest Coverage 0.16
Cash Conversion 162.35%
Profit Quality 111.08%
Current Ratio 0.44
Quick Ratio 0.44
Altman-Z 0.02
F-Score4
WACC9.22%
ROIC/WACC0.04
Cap/Depr(3y)169.69%
Cap/Depr(5y)133.6%
Cap/Sales(3y)30.18%
Cap/Sales(5y)26.74%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-85.74%
EPS 3YN/A
EPS 5Y98.32%
EPS Q2Q%-97.64%
EPS Next Y-44.03%
EPS Next 2Y-11.7%
EPS Next 3Y3.55%
EPS Next 5Y6.25%
Revenue 1Y (TTM)-49.11%
Revenue growth 3Y28.55%
Revenue growth 5Y24.54%
Sales Q2Q%-24.34%
Revenue Next Year-16.68%
Revenue Next 2Y6.26%
Revenue Next 3Y7.46%
Revenue Next 5Y-1.74%
EBIT growth 1Y-97.62%
EBIT growth 3Y51.18%
EBIT growth 5Y-1.78%
EBIT Next Year-20.96%
EBIT Next 3Y-4.66%
EBIT Next 5Y-10.01%
FCF growth 1Y23.58%
FCF growth 3Y-7.82%
FCF growth 5Y1.55%
OCF growth 1Y-4.48%
OCF growth 3Y19.27%
OCF growth 5Y36.48%