VEREN INC (VRN.CA) Stock Fundamental Analysis
TSX:VRN - Toronto Stock Exchange - CA92340V1076 - Common Stock - Currency: CAD
We assign a fundamental rating of 5 out of 10 to VRN. VRN was compared to 219 industry peers in the Oil, Gas & Consumable Fuels industry. VRN has a medium profitability rating, but doesn't score so well on its financial health evaluation. VRN scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
VRN had positive earnings in the past year.
VRN had a positive operating cash flow in the past year.
VRN had positive earnings in 4 of the past 5 years.
In the past 5 years VRN always reported a positive cash flow from operatings.
1.2 Ratios
VRN's Return On Assets of 2.33% is fine compared to the rest of the industry. VRN outperforms 64.25% of its industry peers.
The Return On Equity of VRN (4.04%) is comparable to the rest of the industry.
VRN has a Return On Invested Capital of 8.09%. This is amongst the best in the industry. VRN outperforms 82.81% of its industry peers.
VRN had an Average Return On Invested Capital over the past 3 years of 10.88%. This is above the industry average of 7.60%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 4.04% | ||
| ROIC | 8.09% |
ROA(3y)7.48%
ROA(5y)2.06%
ROE(3y)11.73%
ROE(5y)-2.07%
ROIC(3y)10.88%
ROIC(5y)8.73%
1.3 Margins
VRN has a Profit Margin (6.88%) which is comparable to the rest of the industry.
VRN's Profit Margin has declined in the last couple of years.
The Operating Margin of VRN (27.16%) is better than 79.64% of its industry peers.
In the last couple of years the Operating Margin of VRN has grown nicely.
VRN has a better Gross Margin (72.71%) than 88.24% of its industry peers.
VRN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.16% | ||
| PM (TTM) | 6.88% | ||
| GM | 72.71% |
OM growth 3Y-11.86%
OM growth 5Y3.88%
PM growth 3Y-56.49%
PM growth 5YN/A
GM growth 3Y-1.79%
GM growth 5Y-0.31%
2. Health
2.1 Basic Checks
VRN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for VRN has been reduced compared to 1 year ago.
VRN has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, VRN has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of -0.11, we must say that VRN is in the distress zone and has some risk of bankruptcy.
VRN has a Altman-Z score of -0.11. This is in the lower half of the industry: VRN underperforms 66.97% of its industry peers.
VRN has a debt to FCF ratio of 6.16. This is a slightly negative value and a sign of low solvency as VRN would need 6.16 years to pay back of all of its debts.
The Debt to FCF ratio of VRN (6.16) is better than 73.76% of its industry peers.
VRN has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.37, VRN perfoms like the industry average, outperforming 50.23% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 6.16 | ||
| Altman-Z | -0.11 |
ROIC/WACC1.11
WACC7.28%
2.3 Liquidity
VRN has a Current Ratio of 0.57. This is a bad value and indicates that VRN is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of VRN (0.57) is comparable to the rest of the industry.
VRN has a Quick Ratio of 0.57. This is a bad value and indicates that VRN is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.57, VRN is in line with its industry, outperforming 48.87% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.57 | ||
| Quick Ratio | 0.57 |
3. Growth
3.1 Past
VRN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -34.74%.
The Earnings Per Share has been decreasing by -4.08% on average over the past years.
VRN shows a strong growth in Revenue. In the last year, the Revenue has grown by 24.52%.
VRN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.66% yearly.
EPS 1Y (TTM)-34.74%
EPS 3Y-4.08%
EPS 5YN/A
EPS Q2Q%-75.5%
Revenue 1Y (TTM)24.52%
Revenue growth 3Y11.97%
Revenue growth 5Y6.66%
Sales Q2Q%27.92%
3.2 Future
VRN is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 28.27% yearly.
VRN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.59% yearly.
EPS Next Y82.07%
EPS Next 2Y28.27%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-1.53%
Revenue Next 2Y2.63%
Revenue Next 3Y1%
Revenue Next 5Y4.59%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
VRN is valuated reasonably with a Price/Earnings ratio of 11.21.
Based on the Price/Earnings ratio, VRN is valued a bit cheaper than the industry average as 66.97% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 29.35. VRN is valued rather cheaply when compared to this.
VRN is valuated cheaply with a Price/Forward Earnings ratio of 6.19.
VRN's Price/Forward Earnings ratio is rather cheap when compared to the industry. VRN is cheaper than 80.09% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, VRN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.21 | ||
| Fwd PE | 6.19 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VRN is valued cheaply inside the industry as 89.59% of the companies are valued more expensively.
VRN's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. VRN is cheaper than 76.47% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.68 | ||
| EV/EBITDA | 3.05 |
4.3 Compensation for Growth
VRN's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
VRN has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as VRN's earnings are expected to grow with 28.27% in the coming years.
PEG (NY)0.14
PEG (5Y)N/A
EPS Next 2Y28.27%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.54%, VRN is a good candidate for dividend investing.
VRN's Dividend Yield is rather good when compared to the industry average which is at 6.94. VRN pays more dividend than 91.86% of the companies in the same industry.
VRN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.54% |
5.2 History
The dividend of VRN is nicely growing with an annual growth rate of 62.49%!
VRN has been paying a dividend for over 5 years, so it has already some track record.
VRN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)62.49%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
104.13% of the earnings are spent on dividend by VRN. This is not a sustainable payout ratio.
The dividend of VRN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP104.13%
EPS Next 2Y28.27%
EPS Next 3YN/A
TSX:VRN (3/7/2025, 7:00:00 PM)
7.06
+0.03 (+0.43%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners44.99%
Inst Owner ChangeN/A
Ins Owners0.7%
Ins Owner ChangeN/A
Market Cap4.32B
Analysts82.22
Price Target11.55 (63.6%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.54% |
Yearly Dividend0.46
Dividend Growth(5Y)62.49%
DP104.13%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)41.43%
Min EPS beat(2)38.3%
Max EPS beat(2)44.56%
EPS beat(4)3
Avg EPS beat(4)-46.15%
Min EPS beat(4)-278.4%
Max EPS beat(4)44.56%
EPS beat(8)4
Avg EPS beat(8)-32.29%
EPS beat(12)6
Avg EPS beat(12)-8.97%
EPS beat(16)6
Avg EPS beat(16)-10.55%
Revenue beat(2)1
Avg Revenue beat(2)4.22%
Min Revenue beat(2)-4.22%
Max Revenue beat(2)12.66%
Revenue beat(4)2
Avg Revenue beat(4)-1.39%
Min Revenue beat(4)-19.96%
Max Revenue beat(4)12.66%
Revenue beat(8)2
Avg Revenue beat(8)-9.58%
Revenue beat(12)4
Avg Revenue beat(12)-5.41%
Revenue beat(16)8
Avg Revenue beat(16)-0.48%
PT rev (1m)0.32%
PT rev (3m)-2.46%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.27%
EPS NY rev (1m)0.97%
EPS NY rev (3m)-0.84%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-6.15%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)-1.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.21 | ||
| Fwd PE | 6.19 | ||
| P/S | 1.09 | ||
| P/FCF | 8.68 | ||
| P/OCF | 2.05 | ||
| P/B | 0.64 | ||
| P/tB | 0.66 | ||
| EV/EBITDA | 3.05 |
EPS(TTM)0.63
EY8.92%
EPS(NY)1.14
Fwd EY16.16%
FCF(TTM)0.81
FCFY11.52%
OCF(TTM)3.45
OCFY48.89%
SpS6.49
BVpS11.05
TBVpS10.65
PEG (NY)0.14
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 4.04% | ||
| ROCE | 10.21% | ||
| ROIC | 8.09% | ||
| ROICexc | 8.11% | ||
| ROICexgc | 8.3% | ||
| OM | 27.16% | ||
| PM (TTM) | 6.88% | ||
| GM | 72.71% | ||
| FCFM | 12.53% |
ROA(3y)7.48%
ROA(5y)2.06%
ROE(3y)11.73%
ROE(5y)-2.07%
ROIC(3y)10.88%
ROIC(5y)8.73%
ROICexc(3y)11.09%
ROICexc(5y)8.86%
ROICexgc(3y)11.37%
ROICexgc(5y)9.09%
ROCE(3y)13.72%
ROCE(5y)11.02%
ROICexcg growth 3Y-9.61%
ROICexcg growth 5Y7.92%
ROICexc growth 3Y-9.52%
ROICexc growth 5Y7.96%
OM growth 3Y-11.86%
OM growth 5Y3.88%
PM growth 3Y-56.49%
PM growth 5YN/A
GM growth 3Y-1.79%
GM growth 5Y-0.31%
F-Score6
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 6.16 | ||
| Debt/EBITDA | 1.03 | ||
| Cap/Depr | 120.62% | ||
| Cap/Sales | 40.64% | ||
| Interest Coverage | 5.33 | ||
| Cash Conversion | 87.37% | ||
| Profit Quality | 182.07% | ||
| Current Ratio | 0.57 | ||
| Quick Ratio | 0.57 | ||
| Altman-Z | -0.11 |
F-Score6
WACC7.28%
ROIC/WACC1.11
Cap/Depr(3y)230.75%
Cap/Depr(5y)176.18%
Cap/Sales(3y)74.7%
Cap/Sales(5y)63.8%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-34.74%
EPS 3Y-4.08%
EPS 5YN/A
EPS Q2Q%-75.5%
EPS Next Y82.07%
EPS Next 2Y28.27%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)24.52%
Revenue growth 3Y11.97%
Revenue growth 5Y6.66%
Sales Q2Q%27.92%
Revenue Next Year-1.53%
Revenue Next 2Y2.63%
Revenue Next 3Y1%
Revenue Next 5Y4.59%
EBIT growth 1Y-6.28%
EBIT growth 3Y-1.31%
EBIT growth 5Y10.81%
EBIT Next Year53.37%
EBIT Next 3Y9.52%
EBIT Next 5Y10.8%
FCF growth 1Y118.84%
FCF growth 3Y51.96%
FCF growth 5Y3.41%
OCF growth 1Y-3.82%
OCF growth 3Y12.18%
OCF growth 5Y3.91%