Hemisphere Energy (HME) AI Stock Analysis

• Market Cap: C$196.98M
• Dividend Yield: 8.96%
• Average Volume (3M): 103.97K
• Price to Earnings (P/E): 6.3
• Beta (1Y): 0.49
• Revenue Growth: 2.27%
• EPS Growth: 3.61%
• Country: CA
• Employees: 9
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.07
• Shares Outstanding: 94,700,600
• 10 Day Avg. Volume: 113,639
• 30 Day Avg. Volume: 103,966
• PEG Ratio: 0.13
• Price to Book (P/B): 2.41
• Price to Sales (P/S): 1.80
• P/FCF Ratio: 5.11
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 75 Outperform
• Price Target: C$2.50 ▲(19.62% Upside)

Hemisphere Energy's strong financial performance and attractive valuation are the primary drivers of its stock score. The company's robust profitability and low leverage enhance its financial stability. Technical indicators show a positive trend, though some caution is warranted due to the slightly negative MACD. The absence of earnings call data and corporate events does not impact the score.

Positive Factors

Profitability

High profitability indicates efficient operations and strong market position, supporting long-term financial health and shareholder value.

Balance Sheet Health

Low leverage enhances financial stability and flexibility, enabling the company to invest in growth opportunities and weather market fluctuations.

Cash Flow Efficiency

Strong operating cash flow indicates effective cash management, supporting ongoing operations and potential for reinvestment in business expansion.

Negative Factors

Free Cash Flow Challenges

Declining free cash flow growth could limit the company's ability to fund new projects or return capital to shareholders, impacting future growth.

Gross Profit Margin Pressure

Decreasing gross profit margins may signal rising costs or pricing pressures, potentially affecting long-term profitability if not addressed.

Cash Flow Growth Concerns

Challenges in sustaining cash flow growth could impact the company's ability to invest in future growth and maintain financial flexibility.

Hemisphere Energy Business Overview & Revenue Model

Company Description

Hemisphere Energy (HME) is a Canadian oil and gas company focused on the exploration and production of oil and natural gas in the Western Canadian Sedimentary Basin. With a commitment to operational efficiency and sustainability, Hemisphere Energy primarily engages in the development of its assets, leveraging advanced technologies to enhance production and optimize resource extraction. The company aims to create long-term value for its shareholders while maintaining a focus on environmental stewardship.

How the Company Makes Money

Hemisphere Energy generates revenue primarily through the sale of crude oil and natural gas. The company utilizes a revenue model based on the production and sale of hydrocarbons, where it sells its output to various markets, benefiting from favorable pricing conditions. Key revenue streams include direct sales to refineries, natural gas processing plants, and spot market transactions. Additionally, partnerships with local and regional distributors enhance its market reach and efficiency. The company may also benefit from hedging strategies to protect against price volatility in oil and gas markets, which can contribute to more stable earnings over time.

Hemisphere Energy Financial Statement Overview

Summary

Hemisphere Energy exhibits strong financial health with robust profitability and effective capital management. While revenue and profit margins are commendable, attention is needed on maintaining cash flow growth. The balance sheet reflects stability with low leverage, supporting long-term sustainability.

Income Statement

Hemisphere Energy demonstrates strong profitability with a high net profit margin of 35.25% TTM and consistent revenue growth. The gross profit margin remains robust, indicating effective cost management. However, the slight decline in gross profit margin from previous years suggests potential cost pressures.

Balance Sheet

The company maintains a low debt-to-equity ratio of 0.045 TTM, reflecting prudent financial leverage. Return on equity is impressive at 47.09%, showcasing effective use of equity capital. The equity ratio indicates a solid equity base, though the slight increase in debt warrants monitoring.

Cash Flow

Operating cash flow is strong, with a high coverage ratio of 3.15 TTM. However, the negative free cash flow growth rate of -4.03% TTM suggests challenges in maintaining cash flow levels. The free cash flow to net income ratio remains healthy, indicating efficient cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	101.77M	99.94M	67.70M	96.70M	43.14M	18.66M
Gross Profit	50.16M	49.86M	42.51M	50.39M	22.56M	6.26M
EBITDA	54.15M	54.72M	42.21M	38.63M	13.42M	7.87M
Net Income	31.93M	33.10M	24.20M	21.32M	4.17M	-3.46M
Balance Sheet
Total Assets	118.84M	111.33M	90.74M	78.02M	67.12M	52.48M
Cash, Cash Equivalents and Short-Term Investments	23.15M	12.55M	7.19M	152.00K	-2.15M	435.35K
Total Debt	3.42M	3.79M	3.40M	3.94M	18.09M	25.31M
Total Liabilities	39.67M	36.95M	29.51M	25.02M	41.31M	36.17M
Stockholders Equity	79.16M	74.38M	61.22M	53.00M	25.81M	16.31M
Cash Flow
Free Cash Flow	44.89M	35.16M	27.37M	27.97M	7.44M	8.59M
Operating Cash Flow	57.10M	46.55M	44.24M	45.09M	18.37M	9.39M
Investing Cash Flow	-17.43M	-20.27M	-19.46M	-18.85M	-8.28M	-1.87M
Financing Cash Flow	-25.58M	-20.92M	-17.75M	-26.09M	-10.52M	-8.26M

Hemisphere Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.09
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HME, the sentiment is Positive. The current price of 2.09 is below the 20-day moving average (MA) of 2.12, below the 50-day MA of 2.13, and above the 200-day MA of 1.87, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 51.15 is Neutral, neither overbought nor oversold. The STOCH value of 75.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:HME.

Hemisphere Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HME	75 Outperform	C$196.98M	6.35	39.64%	8.96%	2.27%	3.61%
RBY	72 Outperform	C$236.99M	3.53	17.46%	―	74.76%	7.44%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
ORC.B	60 Neutral	$160.79M	―	―	2.23%	10.08%	322.40%
PRQ	56 Neutral	C$223.69M	25.41	0.20%	6.67%	-8.58%	-98.92%
TPL	56 Neutral	$144.32M	―	-28.62%	0.73%	12.23%	-424.88%
RECO	49 Neutral	C$148.76M	-6.10	-10.23%	―	―	―

Hemisphere Energy Corporate Events

Hemisphere Energy Reports Strong Q2 2025 Results and Declares Dividends

Hemisphere Energy announced its financial and operational results for the second quarter of 2025, highlighting a quarterly production of 3,826 barrels of oil equivalent per day, predominantly heavy oil. The company generated $24.4 million in revenue and achieved a net income of $7.1 million. Hemisphere declared a quarterly dividend and distributed both base and special dividends to shareholders, totaling $5.3 million. Additionally, the company executed a capital expenditure program and renewed its credit facility, indicating a stable financial position and commitment to future growth. These results reflect Hemisphere’s strong operational performance and strategic financial management, positioning it well within the energy industry.