Close menu




November 29th, 2021 | 10:06 CET

Saturn Oil + Gas, BP, Gazprom - Buy when the guns are thundering?

  • Oil
Photo credits: pixabay.com

The possible impact of a new Corona variant led to significant declines in the stock markets at the end of last week. The German benchmark index lost around 1000 points within just 2 weeks. Oil and gas stocks have been hit particularly hard in recent days. The oil price lost last on a single day 11-12%. The development thus prices in, among other things, travel restrictions, lockdowns and a cooling of the economy. The tapping of strategic oil reserves, which US President Biden recently announced, plays a psychological role in the big picture in supply and demand. Much more exciting is what OPEC will soon say about its production plans. Where are the opportunities now?

time to read: 2 minutes | Author: Carsten Mainitz
ISIN: Saturn Oil + Gas Inc. | CA80412L8832 , BP PLC DL-_25 | GB0007980591 , GAZPROM ADR SP./2 RL 5L 5 | US3682872078

Table of contents:


    Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
    "[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG

    Full interview

     

    Saturn Oil + Gas - Record results
    The shares of the Canadian oil and gas producer Saturn Oil & Gas could not escape the wave of panic on the stock markets. Weaker prices are a good opportunity to build up or expand positions. After all, the business of the Canadians is first-class. Recently, the Company was able to report record results.

    In the first full quarter after the acquisition of the Oxbow assets, the producer was able to increase the operating cash flow in Q3 by more than a factor of 13 compared to the same period of the previous year and posted CAD 13.9 million, which equates to a cash flow of CAD 0.55 per share. Of the free cash flow of CAD 9.5 million, almost half was invested in three successful wells. In addition, the Company continued to reduce debt. The debt position as of the balance sheet date was CAD 71.8 million. The share is currently quoted at CAD 3.11, bringing the market value to CAD 78 million.

    In addition, the Company's CEO, John Jeffrey, announced that the Company will continue to systematically reduce its debt and aims to reduce debt by approximately 50% by the end of 2022. Other portions of the free cash flow will be invested in new drilling. Saturn averaged production of 6,970 BOE/d in the third quarter. A year earlier, the figure was just 499 BOE/d. According to the Company, the output is currently around 7,050 BOE/d. Given the solid operating data, we believe the share is currently undervalued.

    BP - Further share buybacks decided
    BP's share prices declined less sharply than crude oil prices in recent days. The rising demand for oil and higher prices led to very decent figures in the third quarter, excluding a one-off effect worth billions. Adjusted for special effects such as valuation changes of oil inventories, BP posted a profit of USD 3.32 billion from July to September, up from just USD 86 million a year earlier. The quarterly dividend remained at the same level of 5.46 US cents per share. The Group announced that it would spend a further USD 1.25 billion on share buybacks.

    The stock is favorably valued from a fundamental perspective. The 2022 P/E ratio is a moderate 6, and the dividend yield is a good 5%. Analysts believe the stock has an average upside potential of 26%. BP's market capitalization is currently the equivalent of USD 84 billion.

    Gazprom - P/E ratio of 3!
    In addition to the falling oil price, the difficulties surrounding the Nord Stream 2 Baltic Sea pipeline continue to weigh on the stock. Political resistance from countries such as the USA, Poland and Ukraine has been unmistakable in recent years. The German Federal Network Agency has interrupted its certification process and demands that the operating Company be organized under German corporate law. Now the Russian state-owned Company wants to set up a company in Germany, and the management board and supervisory board are also to be expanded. Then the certification process can be restarted. But there are still a few hurdles to be cleared at EU level. The Company's valuation is extremely low, with the shares being valued at only a 2022 P/E ratio of 3. Shareholders can look forward to a dividend yield of a whopping 16%! Analysts believe the share has an average upside potential of 35%. This figure already includes a significant discount for country risk.

    All presented oil and gas shares are favorably evaluated. Further setbacks offer favorable entry opportunities. In addition to blue chips such as BP and Gazprom, this applies in particular to Saturn Oil & Gas. In our view, the Canadians have the greatest upside potential.


    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on news.financial. These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.


    Der Autor

    Carsten Mainitz

    The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.

    About the author



    Related comments:

    Commented by Carsten Mainitz on January 21st, 2022 | 09:25 CET

    Shell, Saturn Oil + Gas, Plug Power - Energy stocks in focus

    • Oil

    Oil prices remain in bullish mode, reaching a new seven-year high. The latest increase was due to an explosion of a critical oil pipeline between Iraq and Turkey, through which up to 450,000 barrels of crude oil are transported daily. In general, the supply situation remains tight. OPEC expects a further increase in global oil demand. The primary beneficiaries of this supply shortage are oil producers; they were already able to post record results last year.

    Read

    Commented by Stefan Feulner on January 13th, 2022 | 12:45 CET

    TeamViewer, Saturn Oil + Gas, BP - Target price USD 100

    • Oil

    Oil prices continue to rise. A barrel of Brent currently costs USD 84.32 and is thus on the verge of breaking through a double top formation from the highs of 2018 and 2021. A breakout would generate a fresh buy signal, the target range of which already lies beyond the USD 100 mark. Underpinned by an easing of the Corona situation and an unexpected onset of winter in the US, a new 10-year high at USD 122.88 could even beckon. The primary beneficiaries of this inflationary development are once again the oil producers.

    Read

    Commented by André Will-Laudien on December 30th, 2021 | 11:53 CET

    Royal Dutch, Saturn Oil + Gas, Bayer: The oil price and the pandemic in 2022

    • Oil

    COVID-19 is a black swan for the economy, but does the pandemic favor lower or higher oil prices? Not an easy determination because, for one thing, the measures to contain the pandemic significantly lower economic activity. Production delays and supply chain failures occur, so oil demand should fall there. On the other hand, a shortage of inputs and constraints in logistics lead to higher delivery and waiting times, thus creating some hoarding pressure, which increases demand for the black gold. Due to the shortness of history, the actual connection is also little researched, i.e. how it really is could remain hidden from us for some time. Who benefits from the current cycle of price increases?

    Read