High Arctic Energy Services (HWO) AI Stock Analysis

• Market Cap: C$10.54M
• Dividend Yield: 400%
• Average Volume (3M): 4.48K
• Price to Earnings (P/E): 0.4
• Beta (1Y): 0.64
• Revenue Growth: -82.87%
• EPS Growth: N/A
• Country: CA
• Employees: 15
• Sector: Energy
• Sector Strength: 51
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): -0.02
• Shares Outstanding: 12,696,959
• 10 Day Avg. Volume: 7,709
• 30 Day Avg. Volume: 4,477
• 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: C$1.00
• Price Target Upside: 20.37% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 61 Neutral
• Price Target: C$1.00 ▲(20.48% Upside)

The stock's overall score is driven by its strong valuation metrics, particularly the low P/E ratio and high dividend yield, which suggest potential undervaluation. Financial performance is a concern due to operational challenges, but the company's strong equity position and cash flow generation provide some stability. Technical indicators show neutral momentum.

High Arctic Energy Services Business Overview & Revenue Model

Company Description

High Arctic Energy Services (HWO) is a leading provider of specialized services to the oil and gas industry, primarily focusing on drilling and completions, production services, and equipment rentals. The company operates in various sectors, including conventional and unconventional oil and gas markets, offering a wide range of services such as well intervention, rig mobilization, and logistics support. With a commitment to safety and operational excellence, High Arctic aims to enhance the efficiency and productivity of its clients' operations.

How the Company Makes Money

High Arctic Energy Services generates revenue through multiple key streams, primarily by providing drilling and completions services, as well as production support services to oil and gas companies. The company earns money by charging clients for its specialized equipment rental services, labor, and operational support during drilling and completion projects. Additionally, High Arctic has established significant partnerships with major players in the energy sector, which bolster its market presence and lead to long-term contracts. The company also benefits from fluctuating oil prices and increased drilling activity, which can drive demand for its services. Other revenue opportunities may arise from innovative technology solutions aimed at optimizing drilling and production processes.

High Arctic Energy Services Financial Statement Overview

Summary

High Arctic Energy Services faces significant operational challenges with declining revenues and negative operating margins. However, a strong equity position and cash generation capabilities offer some stability.

Income Statement

High Arctic Energy Services shows a declining trend in revenue with the most recent TTM period indicating a fall in total revenue compared to the previous year. The gross profit margin has improved slightly from the prior year, but the company remains unprofitable with a negative EBIT margin. Notably, despite the negative EBIT, the company reported a positive net income, possibly due to non-operating income or tax benefits. The consistency of negative EBIT and EBITDA margins highlights challenges in operational profitability.

Balance Sheet

The balance sheet displays a moderate level of financial leverage with a Debt-to-Equity ratio of approximately 0.21, indicating a conservative use of debt. The equity ratio stands at 71.09%, reflecting a strong equity base relative to assets. Return on Equity is challenging to assess given the positive net income in the latest TTM, contrasting with previous losses. The company's strong equity position provides some stability despite operational challenges.

Cash Flow

Cash flow analysis reveals a positive operating cash flow in the latest TTM period, with a strong Operating Cash Flow to Net Income ratio, suggesting efficient cash generation relative to net earnings. However, free cash flow has declined from the previous year, signaling potential strain in cash reserves. The Free Cash Flow to Net Income ratio is positive, indicating that the company is converting earnings into cash effectively, albeit with decreased magnitude compared to previous periods.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.47M	61.93M	80.02M	76.44M	90.80M
Gross Profit	2.61M	11.31M	-5.78M	-8.42M	-14.20M
EBITDA	724.00K	-111.00K	-9.41M	4.43M	10.40M
Net Income	28.31M	-13.14M	-36.58M	-18.61M	-25.90M
Balance Sheet
Total Assets	30.87M	123.14M	133.96M	185.45M	214.20M
Cash, Cash Equivalents and Short-Term Investments	3.12M	50.33M	19.56M	12.04M	32.60M
Total Debt	4.66M	6.35M	5.70M	16.52M	19.20M
Total Liabilities	9.76M	23.80M	18.73M	36.60M	36.90M
Stockholders Equity	21.11M	99.33M	115.23M	148.85M	177.30M
Cash Flow
Free Cash Flow	12.33M	9.26M	3.79M	-9.04M	14.80M
Operating Cash Flow	14.27M	11.22M	7.86M	-1.80M	19.70M
Investing Cash Flow	-23.09M	24.21M	6.65M	-5.57M	-1.20M
Financing Cash Flow	-39.10M	-3.93M	-6.74M	-13.39M	5.10M

High Arctic Energy Services Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.83
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HWO, the sentiment is Negative. The current price of 0.83 is below the 20-day moving average (MA) of 0.85, below the 50-day MA of 0.85, and below the 200-day MA of 0.98, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 45.53 is Neutral, neither overbought nor oversold. The STOCH value of 53.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:HWO.

High Arctic Energy Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TCW	79 Outperform	$1.02B	10.49	20.50%	3.24%	-2.14%	-6.88%
TOT	79 Outperform	C$457.76M	7.11	11.66%	3.01%	14.74%	62.76%
SHLE	74 Outperform	C$168.91M	4.22	20.27%	―	18.15%	-75.41%
HWO	61 Neutral	C$10.54M	0.40	-2.30%	400.00%	-82.87%	―
Sector *	54 Neutral	C$4.15B	0.97	16.40%	5.23%	10.45%	-57.37%
STEP	54 Neutral	C$309.71M	151.92	-5.02%	―	-6.25%	-129.86%
CFW	52 Neutral	C$288.59M	29.62	1.53%	―	-4.63%	-92.13%

High Arctic Energy Services Corporate Events

High Arctic Energy Services Announces AGM Results and New Incentive Plan

High Arctic Energy Services announced the results of its annual general and special meeting, where all proposed matters were approved by shareholders. The meeting included the election of four directors and the approval of a new omnibus equity incentive plan, replacing existing plans. Additionally, MNP LLP was appointed as the auditors of the corporation.

High Arctic Energy Services Reports Q1 2025 Financial Results Amid Strategic Growth Plans

High Arctic Energy Services reported a 22% decrease in revenue for the first quarter of 2025 compared to the same period in 2024, despite achieving a higher operating margin percentage. The company has maintained operational excellence and safety, reduced administrative expenses significantly, and is well-positioned to capitalize on increased gas well completion rates. Strategic objectives for 2025 include focusing on safety, managing costs, and pursuing accretive acquisitions to enhance shareholder value.