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Pampa Energia (PAM)
:PAM
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Pampa Energia SA
(NYSE:PAM)
Rating:64Neutral
Price Target:
$81.00
▲(16.75%Upside)
Positive Factors
Financial Management
Net debt decreased by US$150mn, highlighting a positive financial management aspect for Pampa Energia.
Market Valuation
Pampa is trading at approximately 3.6x EV/EBITDA, a 15% discount to historical levels, indicating potential value.
Strategic Initiatives
Pampa Energia has joined a project to monetize its shale gas resources through LNG exports, marking its entrance into the LNG market.
Negative Factors
Earnings Performance
Pampa Energia reported 3Q24 results slightly below estimates, with adj. EBITDA at US$212mn, a 10% decrease from the previous year.
Infrastructure Limitations
Existing export infrastructure is operating close to maximum capacity, which presents a challenge for continued gas production.
Investment Concerns
There is concern regarding the required investments in large-scale projects due to limited visibility on internal rates of return.
Pampa Energia SA (PAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.84B
Dividend YieldN/A
Average Volume (3M)159.13K
Price to Earnings (P/E)7.3
Beta (1Y)0.49
Revenue Growth8.89%
EPS Growth24.01%
CountryUS
Employees2,013
SectorUtilities
Sector Strength72
IndustryIndependent Power Producers
Share Statistics
EPS (TTM)2.80
Shares Outstanding54,540,813
10 Day Avg. Volume149,251
30 Day Avg. Volume159,133
Financial Highlights & Ratios
PEG Ratio3.02
Price to Book (P/B)19.37
Price to Sales (P/S)0.00
P/FCF Ratio217.29
Enterprise Value/Market Cap8.16
Enterprise Value/Revenue3.21
Enterprise Value/Gross Profit53.08
Enterprise Value/Ebitda7.22
Forecast
1Y Price Target
$87.25Price Target Upside25.76% Upside
Rating ConsensusHold
Number of Analyst Covering2
Pampa Energia SA Business Overview & Revenue Model
Company DescriptionPampa Energía S.A., an integrated power company, engages in the generation and transmission of electricity in Argentina. The company operates through Electricity Generation, Oil and Gas, Petrochemicals, and Holding and Other Business segments. It generates electricity through combined thermal generation plants, open-cycle gas turbines, and hydroelectric power generation systems, as well as through a wind farm. The company has an installed electricity generation capacity of approximately 4,970 megawatts; and 21,414 kilometers of high voltage electricity transmission network in Argentina. It is also involved in the exploration and production of oil and gas. In addition, the company offers petrochemicals, such as styrene, synthetic rubber, and polystyrene. As of December 31, 2020, it had approximately 12.625 thousands of barrels of oil and LNG, as well as 24.537 millions of cubic meters of natural gas; owned a refinery with an installed capacity of approximately 25.8 thousand barrels per day; and operated a network of 92 gas stations. The company was formerly known as Pampa Holding S.A. and changed its name to Pampa Energía S.A. in September 2008. Pampa Energía S.A. was incorporated in 1945 and is based in Buenos Aires, Argentina.
How the Company Makes MoneyPampa Energia SA generates revenue through several key streams. In the electricity sector, it earns income from the generation and sale of electricity to the Argentine wholesale electricity market. The company operates multiple power plants, allowing it to sell electricity generated through various sources, including thermal and renewable energy. Additionally, Pampa Energia is involved in the transmission and distribution of electricity, which provides another revenue channel through regulated tariffs set by the government. In the oil and gas sector, the company generates revenue from the exploration, production, and sale of oil and natural gas. This includes both domestic sales and potential exports. The company's earnings are influenced by factors such as government regulations, energy demand, and global energy prices. Strategic partnerships and investments in energy infrastructure also play a significant role in Pampa Energia's financial performance.
Pampa Energia SA Earnings Call Summary
Earnings Call Date:May 12, 2025
(Q1-2025)
| % Change Since: -14.62%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view with significant achievements in LNG project approval and power generation performance. However, challenges in the E&P business, increased costs, and cash flow outflows were notable concerns.Q1-2025 Updates
Positive Updates
FLNG Project Approval
The FID on the FLNG project was approved where Pampa holds a 20% stake. The project will export 6 million tons of LNG per year, requiring 27 million cubic meters of gas per day, marking a strategic move to monetize Vaca Muerta reserves.
Adjusted EBITDA Growth
Pampa Energia reported an adjusted EBITDA of $220 million, representing a 17% increase from the previous year, driven by stronger spot prices in power and higher deliveries of Plan Gas.
Power Generation Business Performance
Adjusted EBITDA in power generation was $130 million in Q1, a 51% increase year-on-year, mainly due to higher spot prices and contributions from the newly commissioned PEPE VI wind farm.
Regulatory Progress in Utilities
TGS and Transener completed their comprehensive tariff reviews, setting conditions for the next five years until 2030, indicating progress toward regulatory normalization.
Export Campaign Expansion
Pampa Energia's 2025 export campaign is on track to double last year's volumes, with new exports to Brazil and increased flows through GasAndes and Pacifico pipelines to Chile.
Negative Updates
E&P Business EBITDA Decline
Adjusted EBITDA in the E&P business was $41 million, down 39% year-on-year due to increased operating expenses and lower sales caused by disruptions in the TGS transportation system.
Increased Lifting Costs
Higher costs due to well testing and preliminary low output at Rincon de Aranda led to a 20% year-on-year increase in lifting costs per boe to $6.9, with gas lifting costs also rising moderately by 17%.
Free Cash Outflow
Pampa reported a free cash outflow of $118 million in Q1, mainly driven by higher CapEx for Rincon de Aranda and a seasonal increase in working capital.
Petrochemical Business Challenges
The petrochemical business faced a tough year with expected breakeven or small EBITDA margins due to international price challenges and higher dollar costs.
Debt Increase
Gross debt stood at $1.6 billion, up 19% from December 2024 due to the redemption of 2027 notes, with net debt increasing to $577 million.
Company Guidance
During the first quarter of 2025, Pampa Energia reported an adjusted EBITDA of $220 million, marking a 17% increase from the previous year, primarily driven by stronger spot prices in power, increased Plan Gas deliveries, and tariff hikes at TGS and Transener. The company's power generation and utility businesses performed solidly, and gas deliveries for thermal generation increased. A significant post-quarter highlight was the FID on the FLNG project, in which Pampa holds a 20% stake. This project will require 27 million cubic meters of gas per day, with Pampa supplying up to 6 million cubic meters per day, representing a nearly 50% increase from their current production. The CapEx for the quarter rose 35% year-on-year, with $114 million allocated to Rincon de Aranda. In the Exploration and Production (E&P) segment, adjusted EBITDA was down 39% year-on-year to $41 million, mainly due to increased operating expenses. Total production averaged 73,000 barrels of oil equivalent per day. The power generation business saw a 51% increase in adjusted EBITDA to $130 million, attributed to higher spot prices and contributions from the newly commissioned PEPE VI wind farm. The company also achieved a net debt of $577 million, reflecting a net leverage ratio of 0.8x, following a redemption of the 2027 notes and issuance of 2031 and 2034 notes.Pampa Energia SA Financial Statement Overview
Summary
Pampa Energia SA exhibits strong profitability margins with a net profit margin of 32.6% in 2024. However, revenue volatility and challenges in cash flow generation, as indicated by negative free cash flow figures, raise liquidity concerns.Income Statement
Pampa Energia SA has shown a fluctuating revenue trend, with a revenue decrease from 2022 to 2024. Gross profit margin in 2024 was approximately 31.7%, indicating a solid profitability level. However, the net profit margin improved significantly to 32.6% in 2024, suggesting enhanced net income efficiency. The EBIT and EBITDA margins also reflect stable operational efficiency.65
Positive
Balance Sheet
The balance sheet shows a strong equity position with a debt-to-equity ratio of 0.64 for 2024, indicating moderate leverage. The equity ratio stands at 51.8%, reflecting a stable financial structure. ROE for 2024 increased to 16.6%, which signals improved profitability for shareholders.70
Positive
Cash Flow
Free cash flow showed volatility with negative figures in recent years, indicating potential cash management concerns. The operating cash flow to net income ratio was 0.68 in 2024, suggesting a decent conversion of net income to cash. However, the free cash flow to net income ratio was negative, highlighting issues in cash generation relative to profitability.50
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.88B | 1.73B | 1.83B | 1.51B | 1.07B |
| Gross Profit | 597.00M | 620.00M | 686.00M | 555.00M | 409.00M |
| EBITDA | 511.12M | 658.00M | 719.00M | 641.00M | 465.00M |
| Net Income | 547.88M | 302.00M | 456.00M | 273.00M | 225.00M |
Balance Sheet | |||||
| Total Assets | 6.34B | 4.72B | 4.74B | 3.86B | 4.89B |
| Cash, Cash Equivalents and Short-Term Investments | 1.67B | 835.00M | 700.00M | 573.00M | 491.00M |
| Total Debt | 2.09B | 1.47B | 1.62B | 1.45B | 1.62B |
| Total Liabilities | 3.05B | 2.31B | 2.46B | 2.07B | 3.12B |
| Stockholders Equity | 3.29B | 2.40B | 2.28B | 1.78B | 1.43B |
Cash Flow | |||||
| Free Cash Flow | -12.45M | -183.00M | 203.00M | 523.00M | 569.00M |
| Operating Cash Flow | 370.65M | 575.00M | 619.00M | 729.00M | 693.00M |
| Investing Cash Flow | -295.64M | -446.00M | -575.00M | -474.00M | -255.00M |
| Financing Cash Flow | 455.26M | -57.00M | -46.00M | -342.00M | -445.00M |
Pampa Energia SA Technical Analysis
Negative
69.38
Price Trends
75.74
Negative
76.65
Negative
76.64
Negative
Market Momentum
-1.91
Positive
37.08
Neutral
16.24
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PAM, the sentiment is Negative. The current price of 69.38 is below the 20-day moving average (MA) of 73.05, below the 50-day MA of 75.74, and below the 200-day MA of 76.64, indicating a bearish trend. The MACD of -1.91 indicates Positive momentum. The RSI at 37.08 is Neutral, neither overbought nor oversold. The STOCH value of 16.24 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PAM.
Pampa Energia SA Risk Analysis
Pampa Energia SA disclosed 99 risk factors in its most recent earnings report. Pampa Energia SA reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Pampa Energia SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.79B | 18.00 | 5.84% | 2.99% | -9.99% | -73.66% | |
71 Outperform | $31.80B | 25.62 | 44.91% | 1.08% | 2.57% | -10.19% | |
70 Outperform | $5.21B | 25.02 | 8.37% | 2.90% | 10.10% | 149.78% | |
67 Neutral | $16.43B | 16.93 | 4.63% | 3.59% | 4.77% | 6.10% | |
64 Neutral | $3.84B | 7.32 | 16.31% | ― | 8.89% | 24.01% | |
63 Neutral | $13.56B | 31.05 | 29.32% | ― | 68.95% | -34.72% | |
55 Neutral | $7.63B | 5.85 | 29.79% | 6.57% | -3.22% | 141.11% |
* Utilities Sector Average
Performance Comparison
PAM
Pampa Energia SA
69.38
26.10
60.30%
NRG
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160.58
83.79
109.12%
TXNM
TXNM Energy
56.32
21.34
61.01%
AES
AES
10.52
-6.39
-37.79%
CEPU
Central Puerto SA
11.68
3.24
38.39%
TLN
Talen Energy Corp
290.77
172.77
146.42%
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.