Talos Energy (TALO)
NYSE:TALO
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Talos Energy
(NYSE:TALO)
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Rating:52Neutral
Price Target:
$14.00
▲(3.70% Upside)
Action:Reiterated
Date:06/10/26
Overall score reflects a tug-of-war between weak reported profitability (deep TTM losses) and strong cash generation with manageable leverage, which stabilizes the financial outlook. Technicals are currently bearish (below key short-term averages with negative MACD), and valuation is difficult to support on a negative P/E. Offsetting these, the latest earnings call was notably positive on execution, liquidity, cost reductions, and capital returns, but project and commodity risks keep the score near the low-to-mid range.
Positive Factors
Cash generation
Sustained cash generation — including robust Q1 adjusted EBITDA and positive adjusted free cash flow plus TTM operating cash flow (~$835M) — provides durable internal funding for low‑breakeven development, buybacks and hedging, reducing reliance on volatile capital markets.
Negative Factors
Profitability erosion
Deep trailing losses and a large negative net margin erode equity and reduce cushions for cyclical downturns. Persistent non‑cash impairments and volatile reported earnings can limit retained capital, constrain returns and weaken long‑term financial flexibility.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Sustained cash generation — including robust Q1 adjusted EBITDA and positive adjusted free cash flow plus TTM operating cash flow (~$835M) — provides durable internal funding for low‑breakeven development, buybacks and hedging, reducing reliance on volatile capital markets.
Read all positive factors
Talos Energy (TALO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.30B
Dividend YieldN/A
Average Volume (3M)1.89M
Price to Earnings (P/E)―
Beta (1Y)0.52
Revenue Growth-15.43%
EPS Growth-3103.48%
CountryUS
Employees700
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)-4.29
Shares Outstanding166,925,810
10 Day Avg. Volume1,974,245
30 Day Avg. Volume1,890,467
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.89
Price to Sales (P/S)1.08
P/FCF Ratio4.25
Enterprise Value/Market Cap1.39
Enterprise Value/Revenue1.83
Enterprise Value/Gross Profit26.92
Enterprise Value/Ebitda8.30
Forecast
1Y Price Target
$17.86Price Target Upside32.28% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)0.28
Revenue Forecast (FY)$2.08B
Talos Energy Business Overview & Revenue Model
Company Description
Talos Energy Inc. functions as an autonomous entity engaged in the discovery and extraction of hydrocarbon resources. The company primarily targets oil and natural gas fields situated in the U.S. Gulf of Mexico and within Mexico's offshore territo...
How the Company Makes Money
Talos Energy primarily makes money by producing and selling crude oil, natural gas, and natural gas liquids from its operated and non-operated working interests in offshore Gulf of Mexico fields. Revenue is generated when produced volumes are deli...
Talos Energy Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive tone driven by strong Q1 execution: production slightly above guidance, robust adjusted EBITDA ($293M) and free cash flow ($113M), low unit costs (~$16/boe and ~30% below peers in 2025), disciplined capital allocation (repurchases, ~7% share count reduction), healthy liquidity (~$1B) and clear project pipeline (CPN, Daenerys, Monument, Brutus). Management acknowledged risks—commodity and geopolitical volatility, exploration/appraisal and rig market uncertainties, timing on Genovese, and outstanding second‑lien notes—but positioned the company as financially flexible with hedging and a focus on low‑breakeven projects. Overall, the positive operational and financial highlights materially outweigh the identified lowlights.Positive Updates
Strong Financial Results and Cash Generation
Adjusted EBITDA of $293 million and adjusted free cash flow of $113 million in Q1 2026, achieved at a low reinvestment rate of ~41%. Invested just under $120 million of exploration and development capital in the quarter.
Negative Updates
Commodity Price and Geopolitical Volatility
Market volatility driven by geopolitical developments (e.g., Iran war) and macro uncertainty. Management emphasized the backwardated forward curve and noted continued price volatility that could affect near- and medium-term cash flows despite current hedging positions.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Financial Results and Cash Generation
Adjusted EBITDA of $293 million and adjusted free cash flow of $113 million in Q1 2026, achieved at a low reinvestment rate of ~41%. Invested just under $120 million of exploration and development capital in the quarter.
Read all positive updates
Company Guidance
Management said full‑year 2026 guidance is unchanged and gave Q2 production targets of 63–67k bbl/d oil and 88–92k boe/d total (Q1 was ~64k bbl/d oil and ~89k boe/d), noting Q1 adjusted EBITDA of $293M and adjusted free cash flow of $113M on ~ $120M of E&D capex and a ~41% reinvestment rate; LOE was ~ $16/boe in Q1 (in line with 2025), 2026 oil mix is ~73%, >40% of a $100M 2026 cost‑saving target has been achieved, development breakevens sit in the $30s–$40s with corporate FCF breakeven in the low‑$50s WTI, liquidity is ~ $1B with the credit facility extended to 2030, the company returned $38M (34% of Q1 adj FCF) via repurchases (≈$135M returned since 2025, ~7% fewer shares), added selective 2026 hedges and initial 2027 protection (about two‑thirds of production is sour), and project timing includes Daenerys spud later in Q2 with results by year‑end, Genovese remediation and midyear return, and Monument first oil on track late 2026.Talos Energy Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
56
Neutral
Cash Flow
67
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.74B | 1.78B | 1.97B | 1.46B | 1.65B | 1.24B |
| Gross Profit | 118.55M | 51.36M | 382.59M | 402.28M | 925.77M | 561.58M |
| EBITDA | 384.62M | 740.47M | 1.26B | 1.05B | 966.11M | 402.67M |
| Net Income | -742.65M | -496.36M | -76.39M | 187.33M | 381.92M | -182.95M |
Balance Sheet | ||||||
| Total Assets | 5.27B | 5.55B | 6.19B | 4.82B | 3.06B | 2.77B |
| Cash, Cash Equivalents and Short-Term Investments | 386.37M | 362.81M | 108.17M | 33.64M | 44.15M | 69.85M |
| Total Debt | 1.24B | 1.24B | 1.24B | 1.20B | 602.14M | 980.77M |
| Total Liabilities | 3.40B | 3.38B | 3.43B | 2.66B | 1.89B | 2.01B |
| Stockholders Equity | 1.87B | 2.17B | 2.76B | 2.16B | 1.17B | 760.65M |
Cash Flow | ||||||
| Free Cash Flow | 488.68M | 453.92M | 453.68M | -42.37M | 386.57M | 118.06M |
| Operating Cash Flow | 841.59M | 935.83M | 962.59M | 519.07M | 709.74M | 411.39M |
| Investing Cash Flow | -493.02M | -546.75M | -1.32B | -512.63M | -311.98M | -293.75M |
| Financing Cash Flow | -195.59M | -164.52M | 436.12M | 85.41M | -423.47M | -82.02M |
Talos Energy Technical Analysis
Negative
13.50
Price Trends
15.04
Negative
14.34
Negative
12.37
Positive
Market Momentum
-0.34
Positive
39.47
Neutral
14.65
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TALO, the sentiment is Negative. The current price of 13.5 is below the 20-day moving average (MA) of 14.78, below the 50-day MA of 15.04, and above the 200-day MA of 12.37, indicating a neutral trend. The MACD of -0.34 indicates Positive momentum. The RSI at 39.47 is Neutral, neither overbought nor oversold. The STOCH value of 14.65 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TALO.
Talos Energy Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.73B | 18.48 | 10.68% | 13.84% | 0.87% | 770.57% | |
68 Neutral | $2.08B | 8.92 | 13.10% | 17.48% | 22.47% | -56.03% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
63 Neutral | $907.25M | -6.21 | -9.13% | 3.71% | -25.80% | -230.75% | |
63 Neutral | $2.69B | 8.46 | 15.50% | ― | 52.41% | ― | |
54 Neutral | $1.45B | -1.52 | -110.09% | ― | -7.65% | -6775.00% | |
52 Neutral | $2.30B | -3.12 | -33.22% | ― | -15.43% | -3103.48% |
* Energy Sector Average
TALO
Talos Energy
13.77
4.93
55.77%
KOS
Kosmos Energy
2.45
0.45
22.50%
KRP
Kimbell Royalty Partners
14.77
1.55
11.76%
HPK
HighPeak Energy
7.18
-3.11
-30.25%
MNR
Mach Natural Resources LP
12.45
-0.70
-5.30%
BKV
BKV Corporation
24.55
0.55
2.29%
Talos Energy Corporate Events
Executive/Board ChangesShareholder Meetings
Talos Energy Stockholders Approve Directors and Executive Pay
Positive
Jun 9, 2026
At its 2026 annual meeting, Talos Energy stockholders elected six directors to one-year terms expiring at the 2027 annual meeting, while director Paula R. Glover concluded her service and the board size was reduced from seven to six. Stockholders ...
Business Operations and StrategyStock BuybackFinancial DisclosuresM&A TransactionsPrivate Placements and Financing
Talos Energy Posts Strong Q1 2026 Results, Boosts Buybacks
Positive
May 6, 2026
Talos Energy reported first-quarter 2026 results on May 5, 2026, with oil output of 63.8 thousand barrels per day and total production of 88.8 thousand barrels of oil equivalent per day, both at or above guidance, generating $174 million in operat...
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.