Obsidian Energy (TSE:OBE)
TSX:OBE
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Obsidian Energy
(TSX:OBE)
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Rating:67Neutral
Price Target:
C$17.50
▲(26.63% Upside)
Action:ReiteratedDate:04/22/26
The score is driven primarily by strong technical momentum (price above key moving averages with positive MACD). Financials are improving with low leverage and a return to profitability, but the rating is held back by negative free cash flow over the last two years and sharp revenue decline, while valuation appears neutral at a 16.6 P/E.
Positive Factors
Conservative leverage and balance-sheet cushion
Debt-to-equity near 0.16 provides structural financial flexibility vs. typical E&P cyclic stress. A conservative leverage profile reduces refinancing risk, supports drilling programs and payouts in weaker cycles, and gives management optionality for capital allocation over the medium term.
Negative Factors
Negative free cash flow two years running
Repeated negative free cash flow (~-$65M annually) indicates the company is investing more than operational cash covers, pressuring liquidity and limiting durable capacity for dividends or buybacks. If sustained, it necessitates asset sales, higher leverage, or external funding to maintain growth plans.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative leverage and balance-sheet cushion
Debt-to-equity near 0.16 provides structural financial flexibility vs. typical E&P cyclic stress. A conservative leverage profile reduces refinancing risk, supports drilling programs and payouts in weaker cycles, and gives management optionality for capital allocation over the medium term.
Read all positive factors
Obsidian Energy (OBE) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.24B
Dividend YieldN/A
Average Volume (3M)427.33K
Price to Earnings (P/E)16.6
Beta (1Y)0.79
Revenue Growth-26.04%
EPS GrowthN/A
CountryCA
Employees203
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)-0.18
Shares Outstanding67,306,950
10 Day Avg. Volume478,347
30 Day Avg. Volume427,329
Financial Highlights & Ratios
PEG Ratio-0.14
Price to Book (P/B)0.42
Price to Sales (P/S)1.08
P/FCF Ratio-9.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$15.83Price Target Upside14.57% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)1.46
Revenue Forecast (FY)C$482.50M
Obsidian Energy Business Overview & Revenue Model
Company Description
Obsidian Energy Ltd. primarily focuses on the exploration, production, and development of oil and natural gas properties in the Western Canada Sedimentary Basin. The company was formerly known as Penn West Petroleum Ltd. and changed its name to Ob...
How the Company Makes Money
Obsidian Energy primarily makes money by producing and selling crude oil, natural gas, and natural gas liquids (NGLs) from its Canadian upstream assets. Revenue is generated when produced volumes are sold into the market, with realized pricing inf...
Obsidian Energy Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a strategic shift following the sale of the Pembina assets, focusing on strengthening the balance sheet and shareholder returns through buybacks. While production growth and exploration successes were positive, increased operating costs and negative free cash flow present challenges.Positive Updates
Pembina Asset Sale
The company closed the sale of its Pembina assets for $320 million, including $211 million in cash, which was used to reduce debt. This transaction strengthened the balance sheet and focused the company’s efforts on key banner assets.
Negative Updates
Increased Operating Costs
Operating costs increased to $15.72 per BOE from $13.91 last year due to higher water handling costs and land survey costs related to the Pembina disposition.
Read all updates
Q1-2025 Updates
Positive
Negative
Pembina Asset Sale
The company closed the sale of its Pembina assets for $320 million, including $211 million in cash, which was used to reduce debt. This transaction strengthened the balance sheet and focused the company’s efforts on key banner assets.
Read all positive updates
Company Guidance
During the call, Obsidian Energy provided guidance for the second quarter of 2025, with an estimated production midpoint of approximately 29,200 barrels of oil equivalent (BOEs) per day, following the sale of their Pembina assets. The production mix is expected to be around 72% oil and liquids. The company has approximately 71 million shares outstanding, translating to a market capitalization of about $385 million. They forecast net debt at the end of the second quarter to be approximately $255 million, with a net debt to funds from operations (FFO) ratio of roughly 1.1x. Obsidian Energy's strategy focuses on delivering superior shareholder returns through production growth, share buybacks, and debt reduction, with a current emphasis on maintaining a prudent leverage position and ample liquidity. The company also highlighted their strategic advantages, including a high-quality asset base, significant potential for future growth, and a strong balance sheet. The call noted that capital expenditures for Q2 are projected to be between $37 million and $42 million, with an expectation of generating positive free cash flow of $16 million.Obsidian Energy Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
73
Positive
Cash Flow
48
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 540.80M | 837.70M | 653.30M | 920.00M | 497.50M |
| Gross Profit | 108.30M | 62.30M | 409.40M | 697.40M | 497.40M |
| EBITDA | 268.20M | 34.20M | 401.20M | 781.00M | 569.80M |
| Net Income | 35.20M | -202.60M | 108.00M | 810.10M | 414.00M |
Balance Sheet | |||||
| Total Assets | 1.85B | 2.11B | 2.25B | 2.20B | 1.43B |
| Cash, Cash Equivalents and Short-Term Investments | 0.00 | 0.00 | 500.00K | 800.00K | 7.30M |
| Total Debt | 216.00M | 342.50M | 228.00M | 231.30M | 399.70M |
| Total Liabilities | 463.20M | 708.80M | 606.60M | 624.60M | 665.70M |
| Stockholders Equity | 1.39B | 1.41B | 1.64B | 1.58B | 763.50M |
Cash Flow | |||||
| Free Cash Flow | -63.50M | -64.60M | 59.60M | 137.40M | 57.70M |
| Operating Cash Flow | 235.70M | 361.90M | 352.70M | 456.80M | 198.70M |
| Investing Cash Flow | -17.20M | -430.50M | -293.60M | -290.80M | -156.60M |
| Financing Cash Flow | -218.40M | 67.60M | -59.40M | -172.50M | -42.90M |
Obsidian Energy Technical Analysis
Positive
13.82
Price Trends
11.73
Positive
10.21
Positive
9.27
Positive
Market Momentum
0.52
Negative
64.10
Neutral
87.22
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:OBE, the sentiment is Positive. The current price of 13.82 is above the 20-day moving average (MA) of 12.85, above the 50-day MA of 11.73, and above the 200-day MA of 9.27, indicating a bullish trend. The MACD of 0.52 indicates Negative momentum. The RSI at 64.10 is Neutral, neither overbought nor oversold. The STOCH value of 87.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:OBE.
Obsidian Energy Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | C$1.11B | 2.80 | 12.43% | ― | 9.29% | 352.05% | |
73 Outperform | C$935.04M | 17.02 | 5.47% | 7.59% | -11.85% | ― | |
72 Outperform | C$1.95B | 2.37 | 112.36% | ― | 392.22% | ― | |
67 Neutral | C$1.24B | 16.60 | 2.52% | ― | -26.04% | ― | |
67 Neutral | C$520.15M | 13.40 | 10.64% | ― | 57.07% | 546.94% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
TSE:OBE
Obsidian Energy
18.48
12.24
196.15%
TSE:SGY
Surge Energy
9.46
4.85
105.03%
TSE:TNZ
Tenaz Energy Corp
60.90
45.00
283.02%
TSE:SOIL
Saturn Oil & Gas
6.16
4.56
285.00%
TSE:LGN
Logan Energy Corp
0.90
0.31
52.54%
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.