Cardinal Energy (CJ) AI Stock Analysis

• Market Cap: C$1.05B
• Dividend Yield: 10.94%
• Average Volume (3M): 635.24K
• Price to Earnings (P/E): 9.7
• Beta (1Y): 0.78
• Revenue Growth: 3.79%
• EPS Growth: 3.87%
• Country: CA
• Employees: 177
• Sector: Energy
• Sector Strength: 87
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.68
• Shares Outstanding: 159,760,910
• 10 Day Avg. Volume: 648,401
• 30 Day Avg. Volume: 635,241
• PEG Ratio: 2.50
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.72
• Price to Cash Flow (P/CF): 5.00
• P/FCF Ratio: 4.80
• 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: C$7.50
• Price Target Upside: 13.64% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

Cardinal Energy stands out with strong financials, stable growth, and strategic expansions in thermal oil projects. Despite moderate technical momentum, its attractive valuation and robust dividend yield enhance its investment appeal. The company's strategic moves to grow reserves and secure financing for future projects further bolster its long-term prospects.

Positive Factors

Free Cash Flow

Incremental free cash flow from Reford coming online should jump start the deleveraging process.

Funding

Funding certainty for the Reford thermal development has been secured with two senior unsecured debenture offerings totaling $105 million.

Negative Factors

Debt

Cardinal's net debt is expected to build further and peak in Q3/25.

Valuation

Cardinal's shares are trading at a 2025E EV/EBITDA multiple of ~5.5x, which is higher than the company’s peer group average of 4.0x.

Cardinal Energy Business Overview & Revenue Model

Company Description

Cardinal Energy Ltd. engages in the acquisition, exploration, and production of low decline light, medium, and heavy quality oil, and natural gas in Western Canada. It has operations in the provinces of Alberta and Saskatchewan. As of February 24, 2022, the company had total proved plus probable oil and gas reserves are 110,391 thousand barrels of oil equivalent. Cardinal Energy Ltd. was incorporated in 2010 and is headquartered in Calgary, Canada.

How the Company Makes Money

Cardinal Energy generates revenue through the extraction and sale of crude oil and natural gas. The company's revenue streams are primarily driven by the market prices of these commodities, which can fluctuate based on global demand and supply dynamics. Cardinal Energy sells its oil and gas production to a variety of buyers, including refineries and other energy companies, often through direct sales contracts or spot market transactions. The company may also engage in hedging activities to manage price risk and stabilize cash flows. Additionally, strategic partnerships and acquisitions of low-decline oil properties help enhance its production capabilities and contribute to its revenue growth.

Cardinal Energy Financial Statement Overview

Summary

Cardinal Energy exhibits a solid financial standing with strong revenue growth and effective cost management. Its balance sheet is stable with low leverage, and cash flow generation is robust. While profitability metrics show potential for enhancement, the overall financial health is commendable.

Income Statement

Cardinal Energy has shown robust revenue growth with a 27% increase from the previous year. The gross profit margin remains strong at approximately 64.2%, indicating efficient cost management. However, the net profit margin stands at 17.7%, suggesting room for improvement in profitability. The absence of EBIT in 2024 affects the comprehensive margin analysis.

Balance Sheet

The company maintains a healthy equity ratio of 70.8%, showcasing financial stability. The debt-to-equity ratio is low at 0.10, reflecting conservative leverage. Return on equity is modest at 11.8%, indicating steady profitability relative to shareholder's equity.

Cash Flow

Cardinal Energy has achieved a 14.6% growth in free cash flow, supported by a strong operating cash flow to net income ratio of 2.28, signifying efficient cash generation. Despite this, free cash flow to net income ratio at 1.33 suggests potential for optimizing capital expenditures.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
611.12M	481.12M	741.84M	448.75M	226.46M
	Gross Profit
392.29M	265.00M	489.37M	290.17M	126.13M
	EBIT
0.00	138.25M	249.77M	102.82M	-17.91M
	EBITDA
252.94M	253.64M	410.56M	385.95M	-171.31M
	Net Income Common Stockholders
108.35M	103.60M	302.69M	284.42M	-363.16M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
0.00	4.09M	-4.49M	-2.63M	-3.91M
	Total Assets
1.30B	1.19B	1.16B	1.08B	749.13M
	Total Debt
90.31M	50.10M	35.77M	157.59M	239.13M
	Net Debt
90.31M	50.10M	40.26M	160.22M	243.05M
	Total Liabilities
378.72M	267.16M	229.64M	356.60M	376.29M
	Stockholders Equity
918.26M	920.69M	925.37M	719.23M	372.85M
Cash Flow		Free Cash Flow
144.26M	125.83M	216.61M	68.72M	12.02M
	Operating Cash Flow
247.54M	230.26M	337.26M	125.12M	43.52M
	Investing Cash Flow
-163.97M	-114.64M	-116.18M	-46.57M	-50.75M
	Financing Cash Flow
-83.57M	-115.63M	-221.08M	-78.55M	7.22M

Cardinal Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.60
• 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 TSE:CJ, the sentiment is Positive. The current price of 6.6 is above the 20-day moving average (MA) of 6.31, above the 50-day MA of 6.37, and above the 200-day MA of 6.30, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 62.73 is Neutral, neither overbought nor oversold. The STOCH value of 88.78 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CJ.

Cardinal Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TOU	78 Outperform	C$25.71B	19.49	8.55%	1.92%	-8.29%	-30.52%
CJ	75 Outperform	C$1.05B	9.67	11.78%	10.94%	3.79%	3.87%
Sector *	58 Neutral	$9.28B	5.49	-6.28%	7.46%	-0.20%	-73.68%

Cardinal Energy Corporate Events

Cardinal Energy Reports Stable 2024 Results and Strategic Thermal Expansion

Cardinal Energy Ltd. reported stable production levels for 2024, maintaining an average of 21,776 boe/d despite a reduction in capital expenditures. The company achieved a 5% increase in adjusted funds flow for the year, directing significant funds towards dividends, asset development, and decommissioning liabilities. The Reford SAGD project received substantial investment, and Cardinal secured additional financing to support future thermal project developments, indicating a strategic focus on expanding their thermal asset base.

Cardinal Energy Declares March Dividend Amidst Strategic Growth

Cardinal Energy Ltd. has announced a monthly dividend of $0.06 per common share for March, payable on April 15, 2025, to shareholders of record as of March 31, 2025. This move underscores Cardinal’s commitment to providing shareholder value and highlights its stable financial position in the oil and gas industry.

Cardinal Energy Secures $45 Million in Debenture Offering to Advance Thermal Oil Projects

Cardinal Energy Ltd. has successfully closed a $45 million bought deal offering of senior subordinated unsecured debentures. The proceeds will be used to repay existing debt, de-risk the completion of its Reford thermal facility, accelerate the Kelfield thermal oil opportunity, and potentially acquire land and seismic data for further thermal oil exploration.

Cardinal Energy Announces $40 Million Debenture Offering to Fund Growth

Cardinal Energy Ltd. has announced a $40 million bought deal offering of senior subordinated unsecured debentures, set to close on March 4, 2025. The proceeds will be used to reduce existing debt and fund the development of thermal oil projects, potentially strengthening the company’s financial stability and market opportunities.

Cardinal Energy Reports 30% Growth in Year-End Reserves with New Thermal Project

Cardinal Energy Ltd. announced its 2024 year-end reserves with a significant 30% growth in Total Proved plus Probable reserves, reaching 154 million boe, thanks in part to the new Reford thermal heavy oil development. This project also contributed to a 31% increase in the company’s Before Tax Net Present Value, highlighting Cardinal’s strengthened asset base and potential for future project expansions.

Cardinal Energy Declares February Dividend, Emphasizes Sustainable Growth

Cardinal Energy Ltd. announced a monthly dividend of $0.06 per share for February, payable on March 17, 2025. This move reflects the company’s steady cash flow and commitment to returning value to shareholders, while leveraging its low decline asset base to maintain a competitive position in the oil and gas sector.

Cardinal Energy Announces Ambitious 2025 Budget with Focus on Thermal Projects

Cardinal Energy Ltd. has announced its 2025 budget, highlighting plans to generate $217 million in adjusted funds flow at US$70 WTI. The company aims to achieve an average production of 21,300 to 21,700 boe/d, with a significant increase expected as the Reford project contributes in the fourth quarter. The budget includes a $71 million conventional capital budget and a $120 million thermal oil budget, with a focus on completing the Reford SAGD project and de-risking another thermal project at Kelfield. Cardinal plans to maintain its dividend at $0.06 per share per month and forecasts substantial free cash flow to support its financial commitments. The Reford project is progressing on schedule, with first steam expected in the third quarter of 2025 and full production by the first quarter of 2026.

Cardinal Energy Declares January Dividend

Cardinal Energy Ltd. announced a monthly dividend of $0.06 per common share, payable on February 18, 2025, to shareholders recorded by January 31, 2025. The cash dividend is recognized as an ‘eligible dividend’ for Canadian tax purposes, reflecting Cardinal’s commitment to providing returns to its shareholders while advancing its operational projects.

Cardinal Energy Completes $60 Million Offering

Cardinal Energy Ltd. has successfully closed a $60 million bought deal offering, issuing senior subordinated unsecured debentures and common share purchase warrants. The proceeds will be used to reduce outstanding debt and fund future projects, including the Reford thermal project. The debentures and warrants are now trading on the Toronto Stock Exchange.