STRATHCONA RESOURCES LTD (SCR.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:SCR - CA8629521086 - Common Stock
26.54 CAD
+0.04 (+0.15%)
We assign a fundamental rating of 7 out of 10 to SCR. SCR was compared to 206 industry peers in the Oil, Gas & Consumable Fuels industry. SCR has an excellent profitability rating, but there are some minor concerns on its financial health. SCR is valued quite cheap, while showing a decent growth score. This is a good combination! This makes SCR very considerable for value investing!
1. Profitability
1.1 Basic Checks
- SCR had positive earnings in the past year.
- SCR had a positive operating cash flow in the past year.
- SCR had positive earnings in 4 of the past 5 years.
- SCR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- SCR has a Return On Assets of 9.93%. This is amongst the best in the industry. SCR outperforms 94.66% of its industry peers.
- Looking at the Return On Equity, with a value of 16.54%, SCR belongs to the top of the industry, outperforming 94.17% of the companies in the same industry.
- SCR has a better Return On Invested Capital (8.57%) than 91.75% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for SCR is significantly above the industry average of 6.62%.
- The last Return On Invested Capital (8.57%) for SCR is well below the 3 year average (12.71%), which needs to be investigated, but indicates that SCR had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.93% | ||
| ROE | 16.54% | ||
| ROIC | 8.57% |
ROA(3y)10.38%
ROA(5y)7.26%
ROE(3y)17.86%
ROE(5y)12.95%
ROIC(3y)12.71%
ROIC(5y)N/A
1.3 Margins
- The Profit Margin of SCR (25.74%) is better than 89.32% of its industry peers.
- SCR's Profit Margin has declined in the last couple of years.
- With an excellent Operating Margin value of 25.08%, SCR belongs to the best of the industry, outperforming 81.07% of the companies in the same industry.
- In the last couple of years the Operating Margin of SCR has declined.
- With a decent Gross Margin value of 44.58%, SCR is doing good in the industry, outperforming 73.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.08% | ||
| PM (TTM) | 25.74% | ||
| GM | 44.58% |
OM growth 3Y-10.43%
OM growth 5YN/A
PM growth 3Y-15.7%
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SCR is still creating some value.
- SCR has about the same amout of shares outstanding than it did 1 year ago.
- SCR has more shares outstanding than it did 5 years ago.
- SCR has a better debt/assets ratio than last year.
2.2 Solvency
- SCR has an Altman-Z score of 1.86. This is not the best score and indicates that SCR is in the grey zone with still only limited risk for bankruptcy at the moment.
- SCR has a Altman-Z score of 1.86. This is in the better half of the industry: SCR outperforms 68.45% of its industry peers.
- The Debt to FCF ratio of SCR is 5.65, which is a neutral value as it means it would take SCR, 5.65 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 5.65, SCR is in the better half of the industry, outperforming 75.24% of the companies in the same industry.
- SCR has a Debt/Equity ratio of 0.09. This is a healthy value indicating a solid balance between debt and equity.
- SCR has a Debt to Equity ratio of 0.09. This is in the better half of the industry: SCR outperforms 72.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.09 | ||
| Debt/FCF | 5.65 | ||
| Altman-Z | 1.86 |
ROIC/WACC1.13
WACC7.56%
2.3 Liquidity
- A Current Ratio of 1.02 indicates that SCR should not have too much problems paying its short term obligations.
- The Current ratio of SCR (1.02) is better than 64.08% of its industry peers.
- A Quick Ratio of 1.00 indicates that SCR should not have too much problems paying its short term obligations.
- SCR's Quick ratio of 1.00 is fine compared to the rest of the industry. SCR outperforms 65.53% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 1 |
3. Growth
3.1 Past
- SCR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 34.58%, which is quite impressive.
- SCR shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.22% yearly.
- Looking at the last year, SCR shows a very negative growth in Revenue. The Revenue has decreased by -43.74% in the last year.
- Measured over the past years, SCR shows a very strong growth in Revenue. The Revenue has been growing by 141.42% on average per year.
EPS 1Y (TTM)34.58%
EPS 3Y-7.22%
EPS 5YN/A
EPS Q2Q%204.55%
Revenue 1Y (TTM)-43.74%
Revenue growth 3Y145.74%
Revenue growth 5Y141.42%
Sales Q2Q%-22.66%
3.2 Future
- Based on estimates for the next years, SCR will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.34% on average per year.
- SCR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.53% yearly.
EPS Next Y54.13%
EPS Next 2Y-18.31%
EPS Next 3Y-0.71%
EPS Next 5Y18.34%
Revenue Next Year-5.49%
Revenue Next 2Y-10.12%
Revenue Next 3Y-4.87%
Revenue Next 5Y4.53%
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 accelerating.
- 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 5.29, which indicates a rather cheap valuation of SCR.
- Based on the Price/Earnings ratio, SCR is valued cheaply inside the industry as 94.66% of the companies are valued more expensively.
- SCR's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.60.
- The Price/Forward Earnings ratio is 14.10, which indicates a correct valuation of SCR.
- 67.96% of the companies in the same industry are more expensive than SCR, based on the Price/Forward Earnings ratio.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.83, SCR is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.29 | ||
| Fwd PE | 14.1 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SCR indicates a rather cheap valuation: SCR is cheaper than 96.12% of the companies listed in the same industry.
- 64.08% of the companies in the same industry are more expensive than SCR, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.91 | ||
| EV/EBITDA | 2.43 |
4.3 Compensation for Growth
- SCR's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- SCR has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.1
PEG (5Y)N/A
EPS Next 2Y-18.31%
EPS Next 3Y-0.71%
5. Dividend
5.1 Amount
- SCR has a Yearly Dividend Yield of 4.42%, which is a nice return.
- In the last 3 months the price of SCR has falen by -28.27%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
- Compared to an average industry Dividend Yield of 3.29, SCR pays a bit more dividend than its industry peers.
- SCR's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.42% |
5.2 History
- SCR has paid a dividend for at least 10 years, which is a reliable track record.
- The dividend of SCR decreased in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
- 21.67% of the earnings are spent on dividend by SCR. This is a low number and sustainable payout ratio.
DP21.67%
EPS Next 2Y-18.31%
EPS Next 3Y-0.71%
STRATHCONA RESOURCES LTD / SCR.CA FAQ
What is the ChartMill fundamental rating of STRATHCONA RESOURCES LTD (SCR.CA) stock?
ChartMill assigns a fundamental rating of 7 / 10 to SCR.CA.
What is the valuation status for SCR stock?
ChartMill assigns a valuation rating of 8 / 10 to STRATHCONA RESOURCES LTD (SCR.CA). This can be considered as Undervalued.
What is the profitability of SCR stock?
STRATHCONA RESOURCES LTD (SCR.CA) has a profitability rating of 8 / 10.
How financially healthy is STRATHCONA RESOURCES LTD?
The financial health rating of STRATHCONA RESOURCES LTD (SCR.CA) is 6 / 10.
What is the expected EPS growth for STRATHCONA RESOURCES LTD (SCR.CA) stock?
The Earnings per Share (EPS) of STRATHCONA RESOURCES LTD (SCR.CA) is expected to grow by 54.13% in the next year.