Serica Energy (SQZ) AI Stock Analysis

• Market Cap: £707.45M
• Dividend Yield: 10.56%
• Average Volume (3M): 1.42M
• Price to Earnings (P/E): 8.8
• Beta (1Y): 1.65
• Revenue Growth: -32.89%
• EPS Growth: -239.58%
• Country: UK
• Employees: 228
• Sector: Energy
• Sector Strength: 69
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): -0.07
• Shares Outstanding: 393,026,430
• 10 Day Avg. Volume: 1,261,580
• 30 Day Avg. Volume: 1,424,233
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £206.67
• Price Target Upside: 14.82% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 66 Neutral
• Price Target: 184.00p ▲(2.22% Upside)

Serica Energy's overall stock score reflects a stable financial base and positive technical indicators. The strong balance sheet and bullish momentum are significant strengths. However, challenges in profit margins, inconsistent revenue growth, and a negative P/E ratio weigh on the score. The earnings call provides a positive outlook, but operational and regulatory challenges remain.

Positive Factors

Growth Prospects

There is an upside potential of 64.9% to the price target, indicating significant growth prospects.

Risk Assessment

The risk of missing production guidance is now seen as low, assuming the extended maintenance shutdown runs to plan.

Valuation

The risked NAV has been increased from 200p to 221p per share, reflecting positive adjustments.

Negative Factors

Operational Delays

Vessel repairs are now not expected to complete before May, versus late March previously.

Operational Performance

Triton's uptime has deteriorated every year since 2021, affecting overall performance.

Production Downgrades

Poor operational uptime on the Triton vessel has been the primary cause of four production downgrades for Serica over the last five months.

Serica Energy Business Overview & Revenue Model

Company Description

Serica Energy (SQZ) is a UK-based independent oil and gas company focused on the exploration and production of hydrocarbons in the North Sea. The company primarily operates in the UK Continental Shelf and is involved in the development of oil and gas fields, with core assets including producing fields and exploration licenses. Serica aims to enhance its portfolio through strategic acquisitions and investments in high-quality assets, leveraging its technical expertise and operational efficiency to deliver sustainable growth.

How the Company Makes Money

Serica Energy generates revenue primarily through the sale of crude oil and natural gas produced from its operated and non-operated assets in the North Sea. The company benefits from a diversified revenue model that includes the sale of hydrocarbons at market prices, which can fluctuate based on global oil and gas markets. Key revenue streams include production from its flagship assets, such as the Bruce, Keith, and Rhum fields, along with potential revenues from new discoveries. Additionally, Serica may enter into joint ventures and partnerships to share the costs and risks associated with exploration and development, further enhancing its financial stability and growth potential.

Serica Energy Financial Statement Overview

Summary

Serica Energy has a strong balance sheet with zero debt and a healthy equity ratio, indicating low financial risk. However, inconsistent revenue growth and declining profit margins weaken its income statement. The cash flow also shows inconsistency, highlighting a need for enhanced free cash flow to support investments.

Income Statement

Serica Energy shows a mixed performance in the income statement. The gross profit margin is healthy, but there is a noticeable decline in net profit and EBIT margins compared to previous years. Revenue growth is inconsistent, with a notable decrease from 2022 to 2023. The company needs to stabilize its revenue and profit margins for improved financial health.

Balance Sheet

The balance sheet is strong with a satisfactory equity ratio and zero debt in recent years, indicating low financial risk. However, the return on equity has decreased from previous levels, which could signal inefficiencies in generating profits from equity. Overall, the company maintains a stable financial position with minimal leverage.

Cash Flow

Cash flow performance is moderate, with some inconsistencies in free cash flow growth. The operating cash flow to net income ratio suggests efficient cash generation from operations, yet the free cash flow to net income ratio has been fluctuating. The company should focus on enhancing its free cash flow to support future investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	657.44M	727.18M	632.64M	998.52M	514.14M	125.64M
Gross Profit	290.19M	223.20M	306.57M	730.40M	386.82M	-2.92M
EBITDA	389.90M	380.03M	432.17M	695.66M	172.68M	51.55M
Net Income	-7.19M	92.43M	102.98M	218.52M	79.29M	7.78M
Balance Sheet
Total Assets	1.26B	1.46B	1.58B	862.38M	686.67M	447.46M
Cash, Cash Equivalents and Short-Term Investments	286.50M	117.46M	245.19M	414.43M	80.08M	89.33M
Total Debt	173.14M	224.32M	213.03M	0.00	0.00	516.00K
Total Liabilities	602.79M	668.29M	741.92M	453.66M	414.14M	247.62M
Stockholders Equity	658.08M	796.46M	655.26M	408.72M	272.53M	199.85M
Cash Flow
Free Cash Flow	-3.20M	21.39M	23.67M	569.11M	105.44M	17.43M
Operating Cash Flow	150.53M	281.56M	98.01M	688.45M	157.60M	44.07M
Investing Cash Flow	-141.73M	-253.91M	-108.77M	-229.19M	-134.35M	-47.94M
Financing Cash Flow	-167.16M	-213.28M	-154.37M	-56.08M	-9.25M	-7.99M

Serica Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 180.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SQZ, the sentiment is Positive. The current price of 180 is above the 20-day moving average (MA) of 169.30, above the 50-day MA of 166.61, and above the 200-day MA of 139.08, indicating a bullish trend. The MACD of 3.56 indicates Negative momentum. The RSI at 65.01 is Neutral, neither overbought nor oversold. The STOCH value of 88.03 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SQZ.

Serica Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GKP	70 Outperform	£420.12M	70.67	-0.09%	6.24%	38.03%	94.56%
SQZ	66 Neutral	£707.45M	8.79	-4.31%	10.56%	-32.89%	-239.58%
Sector *	65 Neutral	$15.51B	7.30	2.96%	5.23%	4.26%	-62.58%
ENQ	63 Neutral	£231.95M	3.26	18.48%	3.57%	-21.23%	―
DEC	58 Neutral	£932.47M	―	-22.53%	6.90%	56.20%	-185.69%
PANR	47 Neutral	£375.35M	―	-4.37%	―	-100.00%	―
RKH	―	£516.17M	45.20	6.97%	―	―	―

Serica Energy Corporate Events

Serica Energy Reports Resilient H1 2025 Performance and Future Growth Plans

Serica Energy reported a resilient financial performance for the first half of 2025, despite challenges such as the downtime at the Triton FPSO. The company is optimistic about increasing production levels to around 50,000 boepd with new wells coming onstream and optimization work at the Bruce Hub. The company is also advancing future production opportunities, including the Belinda field, and plans to replicate the success of its recent drilling campaign. Serica’s robust cash position supports its strategy of funding organic growth and maintaining dividends, while also exploring M&A opportunities in the UK North Sea.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Faces Delays in Triton FPSO Production Ramp-Up

Serica Energy has announced a slower-than-expected ramp-up to steady-state production at the Triton FPSO, following its restart in July. The delay is attributed to issues with the gas lift system and additional minor repairs, but production is expected to stabilize in August. The company anticipates production from the Bittern, Evelyn, and Gannet fields, with new wells in the Guillemot North West and Evelyn fields expected to increase output. Despite the delay, Serica maintains robust production from other assets and expects to achieve a potential output of over 55,000 boepd once all Triton fields are operational. The company’s 2025 production guidance has been slightly adjusted to 33,000-35,000 boepd.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy CFO Increases Stake with Share Purchase

Serica Energy plc announced that its Chief Financial Officer, Martin Copeland, has purchased 45,000 ordinary shares at a price of GBP£1.614 per share, increasing his total shareholding to 107,500 shares. This transaction reflects confidence in the company’s future prospects and may positively influence investor sentiment, reinforcing the company’s market position.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Resumes Production at Triton FPSO Post-Maintenance

Serica Energy has announced the resumption of production operations at the Triton FPSO following the completion of repairs and scheduled maintenance. The company expects production to ramp up and stabilize in July, with potential increases from two new wells. The maintenance included significant repairs and upgrades, which are anticipated to enhance the operational performance of the Triton FPSO, with no further planned outages for 2025.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Transfers Treasury Shares to Employee Benefit Trust

Serica Energy plc announced the transfer of 541,985 Ordinary Shares from Treasury to its Employee Benefit Trust to satisfy Legacy LTIP and SIP Awards. This transaction results in the company no longer holding any Ordinary Shares in Treasury, with a total of 393,568,408 Ordinary Shares now in issue, which defines the voting rights for shareholders and others with notification obligations under the Financial Conduct Authority’s rules.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £232.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Announces Long Term Incentive Plan Awards

Serica Energy plc announced the granting of nil-cost options over 1,703,189 ordinary shares under its 2017 Long Term Incentive Plan. These awards, aimed at incentivizing the executive team and senior management, are contingent on performance criteria related to total shareholder return and emissions reduction targets. This move is designed to align management’s interests with those of shareholders and enhance the company’s operational and environmental performance.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Announces Successful AGM Results and Board Changes

Serica Energy PLC announced that all resolutions proposed at its Annual General Meeting were passed by shareholders. The voting results indicate strong support for the company’s management and strategic direction, with most resolutions receiving over 98% approval. Additionally, Jérôme Schmitt retired from the Board, marking a change in the company’s leadership structure.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Boosts Production and Strategic Flexibility with Key Developments

Serica Energy has announced a positive trading and operations update, highlighting the successful maintenance and drilling activities at the Triton Hub, which are expected to significantly boost production and cash generation in the latter half of the year. The company also completed the acquisition of Parkmead (E&P) Limited, enhancing its tax position and strategic flexibility, while maintaining a disciplined approach to M&A and shareholder returns amidst a challenging regulatory environment.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.

Serica Energy Announces Operational Success and Strategic Acquisition

Serica Energy has announced significant operational updates, including the completion of maintenance work at Triton, which is expected to resume production by the end of June. The company has also reported impressive drilling results from new wells, which are expected to boost production and cash generation. Additionally, Serica has completed the acquisition of Parkmead (E&P) Limited, enhancing its strategic flexibility and tax position. The company remains focused on converting resources to reserves and is preparing for a potential move to the Main Market of the London Stock Exchange.

The most recent analyst rating on (GB:SQZ) stock is a Buy with a £185.00 price target. To see the full list of analyst forecasts on Serica Energy stock, see the GB:SQZ Stock Forecast page.