Ecopetrol SA (EC) AI Stock Analysis

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Ecopetrol SA

(NYSE:EC)

Rating:83Outperform

Price Target:

$11.50

▲(25.41%Upside)

Ecopetrol's strong technical indicators and attractive valuation drive its high overall score, offering potential for growth. Solid financial performance supports the outlook, though challenges like high leverage and market volatility must be managed.

Positive Factors

Exploration and Expansion

New oil exploration bidding rounds likely under a new administration in Colombia, which could expand reserves and production life.

Growth Opportunities

Ecopetrol is considering buying SierraCol Energy Ltd., which could boost its reserves and offer growth potential in the near term.

Valuation

The analyst recommends upgrading Ecopetrol to Buy/High Risk due to considerable room for valuation rerating.

Negative Factors

Financial Performance

Ecopetrol is dealing with higher lifting cost trends and lower cash generation compared to peers, which negatively affects its financial position.

Legal Challenges

Ecopetrol is facing a US$2.2bn tax claim from Colombia’s tax authority, which adds significant uncertainty and risk to the company’s investment thesis.

Macroeconomic Environment

Analyst maintains an Underperform rating due to a challenging macro environment for the oil and gas industry in Colombia and lower production estimates for the upstream business.

Ecopetrol SA (EC) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$18.71B

Dividend Yield68.05%

Average Volume (3M)2.26M

Price to Earnings (P/E)5.6

Beta (1Y)0.26

Revenue Growth-2.26%

EPS Growth-20.04%

CountryUS

Employees18,903

SectorEnergy

Sector Strength54

IndustryOil & Gas Integrated

Share Statistics

EPS (TTM)0.38

Shares Outstanding2,055,834,700

10 Day Avg. Volume2,911,437

30 Day Avg. Volume2,258,645

Financial Highlights & Ratios

PEG Ratio0.65

Price to Book (P/B)22.93

Price to Sales (P/S)0.00

P/FCF Ratio145.41

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$8.30

Price Target Upside-9.49% Downside

Rating ConsensusHold

Number of Analyst Covering4

Ecopetrol SA Business Overview & Revenue Model

Company DescriptionEcopetrol SA is Colombia's largest integrated oil company and a significant player in the global oil and gas industry. The company operates across various sectors including exploration, production, refining, transportation, and commercialization of crude oil and natural gas. Ecopetrol also has a presence in petrochemicals and biofuels, contributing to its diverse product and service portfolio.

How the Company Makes MoneyEcopetrol SA generates revenue primarily through the exploration, production, and sale of crude oil and natural gas. Its upstream operations, which involve the extraction of oil and gas, are a significant revenue driver. The company refines crude oil into various petroleum products, such as gasoline, diesel, and jet fuel, which are sold domestically and internationally. Additionally, Ecopetrol earns income from its transportation network, which includes pipelines and other infrastructure for moving oil and gas products. Partnerships with other oil and gas companies for joint exploration and production ventures also contribute to its earnings. The company's diversification into petrochemicals and biofuels provides additional revenue streams, leveraging its expertise in hydrocarbon processing.

Ecopetrol SA Key Performance Indicators (KPIs)

Any

EBITDA by Segment

EBITDA by Segment
Highlights earnings before interest, taxes, depreciation, and amortization for each business segment, providing insight into the profitability and operational efficiency of different areas within the company.

Chart InsightsEcopetrol's Midstream and Upstream segments show resilience with recent upticks, while Downstream faces volatility due to refining challenges and external price pressures. The earnings call highlights robust production and reserve additions, yet EBITDA is impacted by external factors and refining setbacks. Strategic investments in energy transition and sustainability are promising, but refining margin declines and operational disruptions pose risks. Investors should watch for continued progress in energy transition and efficiency gains as potential growth drivers.

Data provided by:

Main Street Data

Ecopetrol SA Earnings Call Summary

Earnings Call Date:May 06, 2025

(Q1-2025)

% Change Since: 16.37%|

Next Earnings Date:Aug 06, 2025

Earnings Call Sentiment Neutral

Ecopetrol demonstrated strong operational performance and progress in strategic energy initiatives, despite facing challenges such as a decrease in refining margin, tax disputes with DIAN, and the impact of lower Brent prices on financial results.

Q1-2025 Updates

Positive Updates

Strong Production Performance

Ecopetrol achieved a production of 745,000 barrels of oil equivalent per day, marking the highest crude oil production in Colombia in the last five years.

Significant Progress in Gas Initiatives

Ecopetrol signed a regasification services contract on Colombia's Pacific Coast with a project potential of 60 Giga BTUD, expected to begin operations in 2026.

Efficiency and Cost Management

The energy efficiency program generated savings of nearly COP 23 billion, with a total of 21 petajoules achieved since 2018.

ISA's Strong Contribution

ISA exhibited comprehensive growth with an increase of 9% in revenues and 8% in EBITDA year-over-year, contributing 13% of Ecopetrol's revenues and 18% of EBITDA.

Negative Updates

Decrease in Refining Margin

The refining margin decreased by $3.19 per barrel compared to the same period last year, primarily due to scheduled maintenances and operational events.

Challenges with DIAN's Tax Ruling

Ecopetrol faces a potential tax penalty and interest totaling COP 9.4 trillion related to VAT payments for the period 2022 to 2024.

Impact of Lower Brent Prices

Ecopetrol's financial results were impacted by declining Brent prices, affecting net income and requiring strategic financial adjustments.

Company Guidance

During Ecopetrol's earnings conference call for the first quarter of 2025, the company provided guidance amidst a backdrop of global uncertainty and volatile Brent prices. Ecopetrol reported an average production of 745,000 barrels of oil equivalent per day, aligning with annual goals despite local challenges. The refining margin decreased by $3.9 per barrel compared to the previous year, primarily due to product differentials and scheduled maintenance. The company highlighted significant progress in natural gas projects, including a regasification services contract on Colombia’s Pacific Coast, expected to begin operations in the second quarter of 2026, with a capacity of 60 giga BTUD. Additionally, Ecopetrol aims to achieve 900 megawatts of self-generation capacity in renewable energy. The financial report showed stability with an EBITDA of COP 13.3 trillion and a margin of 42%, despite lower Brent prices. The investment execution reached nearly 20%, with a focus on optimizing costs and reinforcing operational efficiency. The company remains committed to maintaining a strong financial position while navigating the energy transition and addressing challenges in the market.

Ecopetrol SA Financial Statement Overview

Summary

Ecopetrol SA demonstrates solid operational and cash flow metrics, highlighting operational efficiency and cash generation capabilities. However, high leverage and fluctuating revenue growth present potential risks. Continued focus on managing profitability and leverage is crucial for future stability.

Income Statement

Positive

Ecopetrol SA shows a strong gross profit margin and consistent EBITDA margins reflecting operational efficiency. However, recent revenue growth has been volatile, indicating potential market challenges. Net profit margin has decreased significantly, highlighting pressure on profitability.

Balance Sheet

Positive

The company maintains a solid equity base with an adequate equity ratio, but the debt-to-equity ratio is relatively high, suggesting considerable leverage. Return on equity has been strong, but recent declines in net income could impact future returns.

Cash Flow

Very Positive

Ecopetrol SA's cash flow position is robust, with a substantial increase in operating cash flow. The free cash flow to net income ratio is favorable, indicating good conversion of income to cash. However, fluctuations in free cash flow growth indicate variability in capital expenditures.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.00T>	10.00T>	10.00T>	91.74T	50.03T
Gross Profit	61.49T	55.92T	70.02T	36.16T	12.47T
EBITDA	52.79T	59.83T	71.12T	38.98T	17.36T
Net Income	14.94T	19.06T	31.60T	15.65T	3.37T
Balance Sheet
Total Assets	10.00T>	10.00T>	10.00T>	10.00T>	10.00T>
Cash, Cash Equivalents and Short-Term Investments	13.00T	14.20T	16.56T	16.18T	7.28T
Total Debt	10.00T>	10.00T>	10.00T>	95.06T	46.73T
Total Liabilities	10.00T>	10.00T>	10.00T>	10.00T>	83.60T
Stockholders Equity	79.85T	75.71T	91.03T	71.73T	52.09T
Cash Flow
Free Cash Flow	24.20T	-4.29T	14.36T	9.24T	-1.93T
Operating Cash Flow	45.13T	19.80T	36.23T	22.54T	9.19T
Investing Cash Flow	-22.03T	-20.02T	-18.09T	-20.52T	-8.53T
Financing Cash Flow	-22.69T	-354.61B	-18.93T	6.96T	-2.63T

Ecopetrol SA Technical Analysis

Technical Analysis Sentiment

Positive

Last Price9.17

Price Trends

50DMA

8.76

Positive

100DMA

8.84

Positive

200DMA

8.18

Positive

Market Momentum

MACD

0.09

Positive

RSI

52.30

Neutral

STOCH

27.87

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EC, the sentiment is Positive. The current price of 9.17 is below the 20-day moving average (MA) of 9.26, above the 50-day MA of 8.76, and above the 200-day MA of 8.18, indicating a neutral trend. The MACD of 0.09 indicates Positive momentum. The RSI at 52.30 is Neutral, neither overbought nor oversold. The STOCH value of 27.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EC.

Ecopetrol SA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EC	83 Outperform	$18.71B	5.56	18.64%	68.05%	-2.26%	-20.04%
PBR	75 Outperform	$79.74B	9.93	11.25%	25.78%	-10.84%	-61.73%
E	73 Outperform	$50.13B	18.38	4.78%	3.38%	-2.17%	-25.00%
EQNR	73 Outperform	$64.49B	8.09	18.28%	5.71%	3.96%	-1.69%
YPF	72 Outperform	$12.69B	7.49	15.54%	―	8.58%	―
BP	65 Neutral	$80.49B	186.20	-1.87%	6.14%	-7.70%	-113.83%
Sector *	64 Neutral	6.20B	16.10	2.07%	7.11%	33.60%	18.24%

* Energy Sector Average

Performance Comparison

Ecopetrol SA

9.17

-0.95

-9.39%

30.93

-3.50

-10.17%

Eni SPA

32.79

3.37

11.45%

PBR

Petroleo Brasileiro SA- Petrobras

13.06

-0.10

-0.76%

EQNR

Equinor ASA

25.69

0.12

0.47%

YPF

YPF Sociedad Anonima

32.28

11.73

57.08%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jun 14, 2025