APA (APA) AI Stock Analysis

• Market Cap: $6.96B
• Dividend Yield: 5.24%
• Average Volume (3M): 7.06M
• Price to Earnings (P/E): 7.0
• Beta (1Y): 0.80
• Revenue Growth: 26.76%
• EPS Growth: -69.10%
• Country: US
• Employees: 2,305
• Sector: Energy
• Sector Strength: 48
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 1.06
• Shares Outstanding: 360,845,120
• 10 Day Avg. Volume: 5,794,983
• 30 Day Avg. Volume: 7,062,256
• PEG Ratio: 0.29
• Price to Book (P/B): 1.25
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.45
• Enterprise Value/Market Cap: 1.75
• Enterprise Value/Revenue: 0.32
• Enterprise Value/Gross Profit: 2.93
• Enterprise Value/Ebitda: 0.64
• 1Y Price Target: $21.90
• Price Target Upside: 14.66% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 21

• Rating: 76 Outperform
• Price Target: $21.50 ▲(12.57%Upside)

APA's overall stock score reflects its strong financial recovery, particularly in revenue and profitability, and the positive sentiment from recent earnings calls. The low P/E ratio and high dividend yield add to its attractiveness. However, technical indicators suggest only moderate momentum, and operational challenges remain, particularly in Egypt and with rising costs in the Permian.

Positive Factors

Debt Reduction

The sale of northern Del assets for $608 million aids in accelerating debt reduction, contributing to rapid de-leveraging.

Financial Performance

Reported adjusted EBITDA of $1.485B exceeded expectations, highlighting effective management of capex and costs.

Operational Efficiency

Cost reduction efforts at APA are running ahead of schedule due to efficiency gains and lower corporate costs.

Negative Factors

Commodity Prices

Lower commodity price realizations and higher opex prompted a reduction in Q2 estimates.

Market Valuation

The company looks expensive on FCF multiples compared to its peer group of large cap E&Ps.

Production Challenges

Weaker public data on Permian well productivity in Q1-Q2'25 was attributed to localized midstream and facility bottlenecks.

APA Business Overview & Revenue Model

Company Description

APA Corporation (APA) is an independent energy company that explores for, develops, and produces natural gas, crude oil, and natural gas liquids. Operating primarily in the United States, Egypt, and the North Sea of the United Kingdom, APA focuses on upstream activities in the oil and gas industry, leveraging its expertise to optimize resource extraction and production across its diverse portfolio of assets.

How the Company Makes Money

APA Corporation generates revenue primarily through the exploration, development, and production of oil and natural gas. The company's key revenue streams include the sale of crude oil, natural gas, and natural gas liquids to various customers, including refineries, utilities, and other energy companies. APA's earnings are significantly influenced by global oil and gas prices, as well as its ability to efficiently manage production costs and optimize output. Strategic partnerships, particularly in international markets like Egypt, also play a crucial role in its revenue generation, providing access to key resources and enhancing operational capabilities.

APA Financial Statement Overview

Summary

APA has demonstrated a strong financial recovery with significant improvements in revenue and profitability. The balance sheet shows manageable leverage, although the low equity ratio poses some risk. Cash flow generation is strong, though historical volatility suggests caution in cash management.

Income Statement

The company has shown a strong recovery with a positive revenue growth rate from the previous year, indicating a robust upward trend. Gross profit margins are healthy, and the net profit margin has improved, reflecting enhanced profitability. However, past volatility in EBIT and EBITDA margins suggests some operational challenges.

Balance Sheet

The company's debt-to-equity ratio is moderate, indicating a manageable level of leverage. Return on equity (ROE) is positive, signaling effective utilization of shareholder funds. However, the equity ratio indicates a relatively low equity base compared to total assets, suggesting potential financial risk if liabilities increase.

Cash Flow

The operating cash flow to net income ratio is strong, indicating efficient cash generation relative to net income. Free cash flow has grown significantly, demonstrating effective cash management. However, historical fluctuations in free cash flow highlight potential volatility in cash flow stability.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.74B	8.28B	11.07B	7.99B	4.43B
Gross Profit	4.30B	4.23B	6.25B	3.54B	905.00M
EBITDA	4.22B	4.75B	7.61B	3.88B	-2.31B
Net Income	804.00M	2.85B	3.67B	973.00M	-4.86B
Balance Sheet
Total Assets	19.39B	15.24B	13.15B	13.30B	12.75B
Cash, Cash Equivalents and Short-Term Investments	625.00M	87.00M	245.00M	302.00M	262.00M
Total Debt	6.16B	5.30B	5.62B	7.61B	8.89B
Total Liabilities	13.03B	11.55B	11.80B	13.31B	12.78B
Stockholders Equity	5.28B	2.65B	423.00M	-1.59B	-1.64B
Cash Flow
Free Cash Flow	769.00M	772.00M	2.54B	2.39B	114.00M
Operating Cash Flow	3.62B	3.13B	4.94B	3.50B	1.39B
Investing Cash Flow	-924.00M	-2.14B	-1.51B	-833.00M	-1.47B
Financing Cash Flow	-2.16B	-1.15B	-3.49B	-2.62B	93.00M

APA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APA, the sentiment is Positive. The current price of 19.1 is above the 20-day moving average (MA) of 19.02, above the 50-day MA of 18.46, and below the 200-day MA of 20.06, indicating a neutral trend. The MACD of 0.11 indicates Positive momentum. The RSI at 52.63 is Neutral, neither overbought nor oversold. The STOCH value of 58.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for APA.

APA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CHRD	82 Outperform	$6.33B	7.32	12.64%	4.65%	31.71%	-32.13%
MTDR	82 Outperform	$6.34B	7.38	17.07%	2.12%	16.20%	-12.42%
APA	76 Outperform	$6.96B	6.98	25.34%	5.24%	26.76%	-69.10%
MUR	75 Outperform	$3.76B	10.01	7.54%	4.78%	-14.90%	-27.53%
RRC	68 Neutral	$8.63B	17.98	11.99%	0.96%	19.95%	0.94%
Sector *	67 Neutral	$15.27B	9.94	6.24%	5.21%	4.47%	-70.67%
CRK	48 Neutral	$6.21B	―	-14.17%	0.66%	-1.73%	-608.98%

APA Corporate Events

APA Corporation Updates Executive Compensation Plan

APA Corporation’s Board of Directors has approved updated agreements for performance shares and stock options under its 2016 Omnibus Compensation Plan. These changes aim to refine executive compensation, with vesting of performance shares now linked to Relative Total Shareholder Return and Cash Return on Invested Capital, enhancing alignment with shareholder interests.