EQUINOR ASA (EQNR.OL) Stock Fundamental Analysis
Europe - Euronext Oslo - OSL:EQNR - NO0010096985 - Common Stock
250.7 NOK
+1.7 (+0.68%)
Taking everything into account, EQNR scores 6 out of 10 in our fundamental rating. EQNR was compared to 71 industry peers in the Oil, Gas & Consumable Fuels industry. While EQNR has a great profitability rating, there are some minor concerns on its financial health. EQNR has a bad growth rate and is valued cheaply. 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.
- EQNR had positive earnings in 4 of the past 5 years.
- EQNR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- EQNR has a better Return On Assets (4.22%) than 61.97% of its industry peers.
- EQNR has a better Return On Equity (14.13%) than 80.28% of its industry peers.
- EQNR has a Return On Invested Capital of 22.60%. This is amongst the best in the industry. EQNR outperforms 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 3 year average ROIC (33.11%) for EQNR is well above the current ROIC(22.60%). The reason for the recent decline needs to be investigated.
| 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
- The Profit Margin of EQNR (5.35%) is comparable to the rest of the industry.
- EQNR's Profit Margin has improved in the last couple of years.
- 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.
- EQNR's Operating Margin has improved in the last couple of years.
- EQNR has a Gross Margin of 48.66%. This is comparable to the rest of the industry: EQNR outperforms 52.11% of its industry peers.
- EQNR's Gross Margin has been stable in the last couple of years.
| 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
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), EQNR is creating value.
- The number of shares outstanding for EQNR has been reduced compared to 1 year ago.
- EQNR has less shares outstanding than it did 5 years ago.
- EQNR has a worse debt/assets ratio than last year.
2.2 Solvency
- EQNR has an Altman-Z score of 2.48. This is not the best score and indicates that EQNR is in the grey zone with still only limited risk for bankruptcy at the moment.
- The Altman-Z score of EQNR (2.48) is better than 63.38% of its industry peers.
- 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.
- Looking at the Debt to FCF ratio, with a value of 4.56, EQNR is in the better half of the industry, outperforming 64.79% of the companies in the same industry.
- EQNR has a Debt/Equity ratio of 0.62. This is a neutral value indicating EQNR is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.62, EQNR is doing worse than 60.56% of the companies in the same industry.
| 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.
- The Current ratio of EQNR (1.23) is comparable to the rest of the industry.
- A Quick Ratio of 1.12 indicates that EQNR should not have too much problems paying its short term obligations.
- EQNR's Quick ratio of 1.12 is fine compared to the rest of the industry. EQNR outperforms 60.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.23 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
- The earnings per share for EQNR have decreased strongly by -28.57% in the last year.
- The Earnings Per Share has been growing by 16.82% on average over the past years. This is quite good.
- 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
- The Earnings Per Share is expected to decrease by -0.02% on average over the next years.
- The Revenue is expected to decrease by -4.76% on average over the next years.
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.
- 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 11.12, the valuation of EQNR can be described as very reasonable.
- Compared to the rest of the industry, the Price/Earnings ratio of EQNR indicates a somewhat cheap valuation: EQNR is cheaper than 74.65% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.87, EQNR is valued rather cheaply.
- EQNR is valuated reasonably with a Price/Forward Earnings ratio of 9.22.
- Based on the Price/Forward Earnings ratio, EQNR is valued a bit cheaper than the industry average as 78.87% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.96, EQNR is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.12 | ||
| Fwd PE | 9.22 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EQNR indicates a rather cheap valuation: EQNR is cheaper than 95.77% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of EQNR indicates a rather cheap valuation: EQNR is cheaper than 80.28% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.41 | ||
| EV/EBITDA | 1.38 |
4.3 Compensation for Growth
- The excellent profitability rating of EQNR 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)0.66
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.
- EQNR's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| 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.
- EQNR's earnings are declining while the Dividend Rate has been growing. 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.