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Tamarack Valley Energy Ltd (TSE:TVE)
TSX:TVE
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Tamarack Valley Energy
(TSX:TVE)
80Outperform
Positive Factors
Budget and Cost Savings
The 2025 budget should continue to excite investors, with less capex, higher production, and lower operating costs than expected.
Inventory and Profitability
The repositioning into the Charlie Lake and Clearwater has materially improved the company’s inventory duration, as well as its go-forward profitability.
Operational Success
Operational success, a production beat, a strong reserve report and focus on debt repayment should continue to impress investors.
Negative Factors
Organic Growth Slowdown
With many of these acquisitions funded with debt, a slowdown in organic growth is likely as the company rebuilds.
Tamarack Valley Energy (TVE) vs. S&P 500 (SPY)
Market Cap
$1.90B
Dividend Yield4.02%
Average Volume (3M)1.92M
Price to Earnings (P/E)12.5
Beta (1Y)1.63
Revenue Growth-0.17%
EPS Growth76.67%
CountryCA
Employees98
SectorEnergy
Sector Strength50
IndustryFossil Fuels
Share Statistics
EPS (TTM)0.30
Shares Outstanding510,615,500
10 Day Avg. Volume2,268,038
30 Day Avg. Volume1,919,075
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)N/A
Price to Sales (P/S)1.59
Price to Cash Flow (P/CF)2.90
P/FCF Ratio2.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$5.63Price Target Upside50.88% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Tamarack Valley Energy Business Overview & Revenue Model
Company DescriptionTamarack Valley Energy Ltd. (TVE) is a Calgary-based oil and gas exploration and production company operating in the energy sector. It focuses on the acquisition, development, and production of oil and natural gas resources in Western Canada. The company's core assets are located in the Cardium, Viking, and Clearwater regions, where it applies innovative technologies to maximize resource recovery and operational efficiency.
How the Company Makes MoneyTamarack Valley Energy Ltd. generates revenue primarily through the exploration, development, and production of crude oil and natural gas. The company sells its oil and gas products in the open market, where prices are influenced by global commodity markets. Key revenue streams include the sale of light and medium crude oil, heavy oil, and natural gas liquids (NGLs). Tamarack Valley Energy enhances its earnings through strategic acquisitions of undervalued assets and maintaining a focus on cost efficiency and operational excellence. Additionally, partnerships and joint ventures with other energy companies can play a significant role in sharing risks and optimizing resource development.
Tamarack Valley Energy Financial Statement Overview
Summary
Tamarack Valley Energy demonstrates strong financial performance with significant revenue growth and robust cash flow improvements. Key highlights include a 23.86% revenue increase, a 50.42% EBITDA margin, and a strong free cash flow growth of 231.92%. However, the absence of EBIT is a concern, indicating potential operational inefficiencies.Income Statement
Tamarack Valley Energy has demonstrated strong revenue growth with a 23.86% increase from 2023 to 2024. The gross profit margin stands at 33.53%, and the net profit margin improved to 9.31% in 2024. However, EBIT was zero, which may indicate operational challenges. EBITDA margin remains robust at 50.42%, highlighting effective cost management. Overall, the income statement reflects solid growth and profitability, but the absence of EBIT is a concern.82
Very Positive
Balance Sheet
The company's debt-to-equity ratio decreased to 0.36, showing improved leverage management. The equity ratio is healthy at 53.18%, suggesting a strong equity base. Return on equity is moderate at 7.65%, indicating potential for higher profitability. The balance sheet is stable with a strong equity position, but there is room for improvement in profitability.75
Positive
Cash Flow
Operating cash flow improved significantly by 31.92% from 2023 to 2024, and free cash flow grew by 231.92%, indicating strong cash generation capabilities. The operating cash flow to net income ratio is high at 5.14, and the free cash flow to net income ratio is 2.36, both demonstrating efficient cash utilization. Cash flow stability is a key strength, though maintaining this trajectory is crucial.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.74B | 1.41B | 1.46B | 701.05M | 222.07M |
| Gross Profit | ||||
| 584.17M | 418.26M | 615.12M | 268.63M | -9.64M |
| EBIT | ||||
| 0.00 | 354.96M | 523.72M | 224.63M | -27.40M |
| EBITDA | ||||
| 877.97M | 884.22M | 878.64M | 758.48M | -265.57M |
| Net Income Common Stockholders | ||||
| 162.22M | 94.20M | 345.20M | 390.51M | -311.38M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 7.39M | 2.22M | -75.84M | -10.53M | -10.15M |
| Total Assets | ||||
| 3.99B | 4.21B | 4.62B | 2.33B | 1.03B |
| Total Debt | ||||
| 771.89M | 860.65M | 1.22B | 487.97M | 221.01M |
| Net Debt | ||||
| 764.50M | 860.65M | 1.30B | 498.50M | 231.16M |
| Total Liabilities | ||||
| 1.87B | 2.03B | 2.46B | 1.07B | 518.08M |
| Stockholders Equity | ||||
| 2.12B | 2.17B | 2.16B | 1.26B | 509.52M |
| Cash Flow | Free Cash Flow | |||
| 382.31M | 115.17M | -606.52M | -349.52M | 21.75M |
| Operating Cash Flow | ||||
| 833.21M | 631.63M | 805.38M | 297.89M | 125.29M |
| Investing Cash Flow | ||||
| -453.38M | -378.02M | -1.27B | -581.06M | -181.56M |
| Financing Cash Flow | ||||
| -374.66M | -253.61M | 465.18M | 283.17M | 56.27M |
Tamarack Valley Energy Technical Analysis
Negative
3.73
Price Trends
4.14
Negative
4.33
Negative
4.14
Negative
Market Momentum
-0.14
Negative
43.62
Neutral
83.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TVE, the sentiment is Negative. The current price of 3.73 is below the 20-day moving average (MA) of 3.93, below the 50-day MA of 4.14, and below the 200-day MA of 4.14, indicating a bearish trend. The MACD of -0.14 indicates Negative momentum. The RSI at 43.62 is Neutral, neither overbought nor oversold. The STOCH value of 83.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:TVE.
Tamarack Valley Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $1.90B | 12.47 | 7.57% | 4.02% | -0.17% | 76.67% | |
73 Outperform | $4.80B | 5.98 | 14.51% | 8.89% | 3.34% | -6.99% | |
69 Neutral | $1.13B | 14.11 | 3.20% | 13.23% | -5.80% | -87.18% | |
68 Neutral | C$1.81B | 7.95 | 5.99% | 3.87% | 22.71% | ― | |
63 Neutral | $1.40B | ― | -1.59% | 5.61% | -1.72% | 79.87% | |
55 Neutral | $7.03B | 3.41 | -6.12% | 6.02% | -0.15% | -51.29% |
* Energy Sector Average
Performance Comparison
TSE:TVE
Tamarack Valley Energy
3.72
>-0.01
-0.24%
TSE:BTE
Baytex Energy
2.28
-2.82
-55.33%
TSE:PXT
Parex Resources
11.53
-10.30
-47.17%
TSE:WCP
Whitecap Resources
8.02
-1.98
-19.82%
TSE:VET
Vermilion Energy
8.89
-6.72
-43.05%
Tamarack Valley Energy Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -16.98% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong year for Tamarack Valley Energy with record production, significant shareholder returns, and successful implementation of capital efficiency measures. Despite some operational challenges like gas plant delays, the company is well-positioned for continued growth and value creation.Highlights
Record Year for Tamarack Valley Energy
The company achieved a record annual production of 64,331 BOE per day and delivered $851 million of adjusted funds flow, highlighting significant operational success.
Capital Efficiency and Production Growth
Tamarack deployed a disciplined capital program with a CapEx spend of $439 million, drilling additional wells without increasing the capital plan. Production in core areas saw significant growth, with Clearwater volumes up 10% and Charlie Lake up 9%.
Shareholder Returns and Debt Reduction
In 2024, Tamarack bought back 6% of outstanding shares, increased the base dividend by 2%, and achieved a total shareholder return of 21%. The company focuses on further debt reduction and plans to reach a debt-to-EBITDA ratio of 0.5 by the end of 2025.
Waterflood Success and Long-term Value Creation
The waterflood program has been successful, with ultimate recoveries of up to 3x compared to primary methods. The company has identified over 2,000 Clearwater locations for continued development, supporting long-term value creation.
Strong Reserve Metrics
Tamarack grew 2P reserves by 8% and achieved a PDP recycle ratio of 3.1x and a TPP recycle ratio of 4.2x, marking top-tier performance among peers.
Lowlights
CSV Gas Plant Delays
The CSV Albright gas plant construction has faced delays, with no firm start-up date confirmed, affecting the company's operational timeline.
One-time Cost Adjustments
Q4 operating costs were positively impacted by one-time items such as lower municipal taxes, suggesting that the low costs might not be sustainable in the future.
Company Guidance
During the conference call held on February 25, 2025, Tamarack Valley Energy Limited provided detailed guidance on their performance and future plans. For the fiscal year 2024, the company achieved an impressive annual production of 64,331 BOE per day and a record $851 million in adjusted funds flow. Their capital expenditures totaled $439 million, aligning with prior guidance, and they successfully increased 2P reserves by 8% while maintaining flat future development costs. Tamarack reported a total shareholder return of 21%, facilitated by a 6% share buyback and a 2% increase in base dividends. The company also emphasized its waterflood strategy, which significantly reduced decline rates and improved capital efficiencies, contributing to a field operating netback of $46.41 per BOE. Looking ahead to 2025, Tamarack plans to maintain production between 65,000 to 67,000 BOE per day with capital expenditures ranging from $430 million to $450 million. They anticipate further cost reductions and efficiency improvements, including drilling more wells per pad and leveraging owned infrastructure to sustain production targets.Tamarack Valley Energy Corporate Events
Dividends
Tamarack Valley Energy Declares Monthly Dividend, Reinforcing Shareholder Value
Positive
Apr 15, 2025
Tamarack Valley Energy Ltd. announced a monthly cash dividend of C$0.01275 per share, payable on May 15, 2025, to shareholders of record as of April 30, 2025. This announcement underscores the company’s commitment to returning capital to shareholders and highlights its stable financial position, potentially enhancing its attractiveness to investors seeking regular income.
Spark’s Take on TSE:TVE Stock
According to Spark, TipRanks’ AI Analyst, TSE:TVE is a Outperform.
Tamarack Valley Energy’s strong financial performance, particularly in revenue and cash flow growth, significantly contributes to its score. The earnings call highlights robust operational achievements and future potential, although technical analysis indicates short-term bearish trends. Valuation metrics suggest the stock is attractively priced, but the lack of EBIT and operational challenges may temper investor enthusiasm. Overall, the company is well-positioned for long-term growth, but short-term market sentiment may remain cautious.
To see Spark’s full report on TSE:TVE stock, click here.
DividendsBusiness Operations and Strategy
Tamarack Valley Energy Declares Monthly Dividend for April 2025
Positive
Mar 14, 2025
Tamarack Valley Energy Ltd. has announced a monthly cash dividend of C$0.01275 per share, payable on April 15, 2025, to shareholders of record as of March 31, 2025. This dividend declaration aligns with Tamarack’s strategy to return capital to shareholders, reinforcing its commitment to financial stability and shareholder value, while potentially impacting its market positioning positively.
Stock BuybackDividendsBusiness Operations and StrategyFinancial Disclosures
Tamarack Valley Energy Achieves Record Financial Performance in 2024
Positive
Feb 25, 2025
Tamarack Valley Energy reported record financial results for 2024, achieving an adjusted funds flow of $851 million and exceeding production expectations with 64,331 boe/d. The company enhanced shareholder returns through dividends, share buybacks, and debt reduction, while improving operational efficiencies and cost structures. Tamarack’s strategic focus on its core areas led to significant production growth and improved heavy oil margins, positioning the company strongly within the industry.
DividendsBusiness Operations and Strategy
Tamarack Valley Energy Declares Monthly Dividend for Shareholders
Positive
Feb 14, 2025
Tamarack Valley Energy has announced a monthly dividend of C$0.01275 per common share, payable on March 14, 2025, to shareholders of record as of February 28, 2025. This dividend aligns with the company’s strategy of returning capital to shareholders, highlighting its commitment to financial stability and enhancing shareholder value.
Business Operations and StrategyFinancial Disclosures
Tamarack Valley Energy Reports Strong 2024 Reserves and Operational Success
Positive
Feb 12, 2025
Tamarack Valley Energy announced its 2024 reserve evaluation results, showcasing significant operational success and strategic execution. The company reported a notable increase in reserves due to effective drilling and waterflood programs, particularly in the Clearwater and Charlie Lake plays, achieving increased intrinsic valuations and strong recycle ratios, which underscore its cost-efficient operations and market competitiveness.
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.