Northern Oil And Gas (NOG) AI Stock Analysis

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Northern Oil And Gas

(NYSE:NOG)

72Outperform

The overall stock score for Northern Oil and Gas is supported by strong financial performance, particularly in revenue growth and cash flow generation. Despite attractive valuation metrics, technical analysis indicates bearish momentum. The earnings call reflects a strong long-term strategy but highlights immediate operational challenges.

Positive Factors

Dividend and Yield

Last month, the quarterly base dividend was raised by approximately 7% to $0.45 per share, offering an above-average yield of about 5%.

Mergers and Acquisitions

NOG is preparing a sweeter offer for the new year, suggesting potential for a successful acquisition of Granite Ridge.

Natural Gas Production

NOG continues to benefit from its natural gas position with production coming in between 315 – 319 mmcfd, above consensus of 300 mmcfd.

Negative Factors

Financial Forecast

Analyst lowers 4Q24 CFPS/EBITDX forecasts by ~4% on weaker oil volumes and wider gas differentials.

Fourth Quarter Performance

Fourth quarter volumes were negatively impacted by Bakken wildfires and third-party rail delays in Uinta.

Oil Production Guidance

NOG announced 2025 guidance which fell short of expectations, with capex ~3% above consensus while oil volume guidance was ~5% below.

Northern Oil And Gas (NOG) vs. S&P 500 (SPY)

Market Cap

$2.23B

Dividend Yield7.32%

Average Volume (3M)2.29M

Price to Earnings (P/E)4.4

Beta (1Y)1.06

Revenue Growth29.45%

EPS Growth-48.29%

CountryUS

Employees49

SectorEnergy

Sector Strength52

IndustryOil & Gas Exploration & Production

Share Statistics

EPS (TTM)1.11

Shares Outstanding99,113,650

10 Day Avg. Volume2,921,170

30 Day Avg. Volume2,292,098

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)1.59

Price to Cash Flow (P/CF)2.60

P/FCF Ratio2.30

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$39.15

Price Target Upside66.17% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

Northern Oil And Gas Business Overview & Revenue Model

Company DescriptionNorthern Oil and Gas, Inc., an independent energy company, engages in the acquisition, exploration, exploitation, development, and production of crude oil and natural gas properties in the United States. The company primarily holds interests in the Williston Basin, the Appalachian Basin, and the Permian Basin in the United States. As of December 31, 2021, it owned working interests in 7,436 gross producing wells; and had proved reserves of 287,682 million barrels of oil equivalent. The company is based in Minnetonka, Minnesota.

How the Company Makes MoneyNorthern Oil and Gas generates revenue primarily through the production and sale of crude oil and natural gas. By acquiring non-operated working interests, the company benefits from its partnerships with major operators who manage the day-to-day drilling and extraction activities. This model allows NOG to participate in the revenue streams generated from the sale of oil and natural gas without directly managing the operations. Northern Oil and Gas also enhances its earnings by strategically acquiring assets in regions known for high productivity and favorable economic conditions. The company's revenue is influenced by several factors, including commodity prices, production volumes, and operational efficiency. Additionally, NOG's partnerships with leading operators in the industry help to optimize its asset portfolio and contribute to its overall earnings.

Northern Oil And Gas Financial Statement Overview

Summary

Northern Oil And Gas has demonstrated solid financial recovery with substantial revenue and income growth. Notably, their cash flow management is robust, and the balance sheet shows improved stability despite past high leverage.

Income Statement

Positive

Northern Oil And Gas has shown significant revenue growth over the years, notably increasing from $324 million in 2020 to over $2.2 billion in 2024. The Gross Profit Margin has been substantial, and the company has demonstrated strong profitability with a Net Profit Margin of 23.4% in 2024. There was a remarkable recovery from a net loss in 2020 to consistent profitability. However, EBIT and EBITDA margins have fluctuated, indicating some variability in operating efficiency.

Balance Sheet

Positive

The balance sheet shows a strong equity position with an increased Stockholders' Equity from negative in 2020 to over $2.3 billion in 2024. The Debt-to-Equity ratio has improved significantly due to debt reduction, indicating enhanced financial stability. However, the company still faces potential risk from past high leverage periods, though recent improvements are noteworthy.

Cash Flow

Very Positive

Cash flow analysis reveals strong Operating Cash Flow growth, reaching $1.4 billion in 2024, which supports robust Free Cash Flow. The Free Cash Flow to Net Income ratio is favorable, suggesting efficient cash generation relative to earnings. The consistent Free Cash Flow growth and positive Operating Cash Flow to Net Income ratio highlight effective cash management.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
2.16B	1.91B	1.99B	975.09M	324.07M
	Gross Profit
2.23B	913.86M	1.32B	586.49M	15.83M
	EBIT
837.83M	1.12B	853.19M	415.31M	-2.72M
	EBITDA
1.58B	1.62B	1.11B	206.44M	-685.58M
	Net Income Common Stockholders
520.31M	922.97M	773.24M	6.36M	-906.04M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
8.93M	8.20M	2.53M	9.52M	1.43M
	Total Assets
5.60B	4.48B	2.88B	1.52B	872.09M
	Total Debt
2.37B	1.84B	1.53B	803.44M	944.84M
	Net Debt
2.36B	1.83B	1.52B	793.92M	943.41M
	Total Liabilities
3.28B	2.44B	2.13B	1.31B	1.10B
	Stockholders Equity
2.32B	2.05B	745.26M	215.13M	-223.30M
Cash Flow		Free Cash Flow
1.41B	-661.93M	-431.36M	-197.32M	47.76M
	Operating Cash Flow
1.41B	1.18B	928.42M	396.47M	331.69M
	Investing Cash Flow
-1.67B	-1.86B	-1.40B	-634.43M	-283.93M
	Financing Cash Flow
266.83M	684.69M	467.37M	246.06M	-62.40M

Northern Oil And Gas Technical Analysis

Technical Analysis Sentiment

Negative

Last Price23.56

Price Trends

50DMA

28.76

Negative

100DMA

33.55

Negative

200DMA

35.35

Negative

Market Momentum

MACD

-1.87

Negative

RSI

41.55

Neutral

STOCH

70.18

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NOG, the sentiment is Negative. The current price of 23.56 is below the 20-day moving average (MA) of 25.61, below the 50-day MA of 28.76, and below the 200-day MA of 35.35, indicating a bearish trend. The MACD of -1.87 indicates Negative momentum. The RSI at 41.55 is Neutral, neither overbought nor oversold. The STOCH value of 70.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NOG.

Northern Oil And Gas Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NOG	72 Outperform	$2.23B	4.38	23.82%	7.32%	29.45%	-48.29%
CIVI	72 Outperform	$2.49B	3.16	13.09%	7.06%	49.65%	-5.53%
STR	63 Neutral	$2.37B	31.79	2.66%	8.48%	5.23%	―
VAL	63 Neutral	$2.23B	6.10	17.67%	―	32.42%	-56.29%
Sector *	55 Neutral	$7.05B	3.40	-6.09%	6.09%	-0.43%	-51.04%
CRGY	54 Neutral	$2.09B	23.27	-4.74%	5.92%	23.01%	-153.02%
PTEN	46 Neutral	$2.27B	―	-23.39%	5.44%	29.70%	-341.43%

* Energy Sector Average

Performance Comparison

NOG

Northern Oil And Gas

23.56

-17.48

-42.59%

CIVI

Civitas Resources

29.26

-38.63

-56.90%

PTEN

Patterson-UTI

5.88

-5.32

-47.50%

STR

Sitio Royalties

16.75

-5.85

-25.88%

VAL

Valaris

31.33

-37.79

-54.67%

CRGY

Crescent Energy Company Class A

8.30

-2.24

-21.25%

Northern Oil And Gas Earnings Call Summary

Earnings Call Date: Feb 19, 2025 | % Change Since: -32.45% | Next Earnings Date: Apr 29, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed outlook with significant achievements in terms of production growth, financial performance, and strategic acquisitions. However, these were offset by operational disruptions and increased costs. The company's long-term growth strategy remains strong, but immediate challenges are notable.

Highlights

Record Production Growth

Northern Oil and Gas, Inc. reported a 25% year-over-year growth in oil volumes, achieving high single-digit growth for 2025 with a strong exit expected in 2025.

Successful Acquisition and Expansion

The company executed significant acquisitions, including 14 ground game deals in Q4, expanding in key basins like Appalachia, Permian, and Uinta.

Strong Financial Performance

Adjusted EBITDA was $1.6 billion and free cash flow was $461 million for 2024, marking all-time highs for the company.

Positive Outlook for M&A

The company is evaluating $8 billion in assets across various basins, indicating a strong pipeline for future growth.

Continued Dividend Growth

Northern Oil and Gas, Inc. delivered nearly $260 million in returns through dividends and share repurchases in 2024.

Lowlights

Operational Disruptions

The company faced multiple challenges, including forest fires, refinery outages, and freeze-offs, which affected Q4 oil volumes and will impact the start of 2025.

Higher Lease Operating Expenses

LOE increased to $9.62 per BOE due to fixed carrying costs and disruptions primarily in the Williston Basin.

Delayed Well Completions

Refrac start-up delays and deferrals in the Williston Basin and third-party takeaway issues in the Uinta Basin led to delayed well completions.

Increased Workover Costs

Workover costs have increased as shale wells age, contributing to a higher capital expenditure.

Company Guidance

During Northern Oil and Gas, Inc.'s fourth quarter and year-end 2024 earnings call, Chief Financial Officer Chad Allen detailed the guidance for 2025, emphasizing a production range of 130,000 to 145,000 BOE per day, with oil production expected between 75,000 to 79,000 barrels per day. The capital expenditure budget is set between $1.05 billion and $1.2 billion, including 25% allocated for ground game acquisition and development and 10% for the Appalachian drilling partnership. Cash taxes are projected to be under $10 million, primarily from state income taxes. The call highlighted a production ramp towards the end of the year, with a significant portion of completions anticipated in the back half of 2025, and noted the potential for further growth into 2026 due to the strategic build-up of the D&C list and the completion of ongoing projects.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.