Obsidian Energy (TSE:OBE)
TSX:OBE
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Obsidian Energy
(TSX:OBE)
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Rating:62Neutral
Price Target:
C$13.50
▲(5.30% Upside)
Action:ReiteratedDate:02/21/26
The score is driven primarily by mixed financial performance—improving profitability and conservative leverage, but sharp revenue decline and two years of negative free cash flow. Technicals add support with an uptrend across key moving averages and positive momentum. Valuation is a headwind due to a negative P/E and no stated dividend yield.
Positive Factors
Conservative leverage
Low debt-to-equity (~0.16) gives Obsidian durable financial flexibility to fund capital needs, withstand commodity downturns, and avoid distress. A conservative balance sheet supports investment continuity, potential opportunistic M&A, and reduces refinancing risk across cycles.
Negative Factors
Sharp revenue decline
A ~23% top-line decline signals weakening volumes or realizations, eroding scale and margin resilience. Persistently lower revenue can force tougher capital allocation choices, reduce economies of scale, and magnify the impact of fixed costs on long-term profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative leverage
Low debt-to-equity (~0.16) gives Obsidian durable financial flexibility to fund capital needs, withstand commodity downturns, and avoid distress. A conservative balance sheet supports investment continuity, potential opportunistic M&A, and reduces refinancing risk across cycles.
Read all positive factors
Obsidian Energy (OBE) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$862.88M
Dividend YieldN/A
Average Volume (3M)238.19K
Price to Earnings (P/E)16.6
Beta (1Y)1.00
Revenue Growth-11.85%
EPS Growth-307.86%
CountryCA
Employees203
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)-0.18
Shares Outstanding67,306,950
10 Day Avg. Volume270,068
30 Day Avg. Volume238,191
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$10.93Price Target Upside-14.70% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.22
Revenue Forecast (FY)C$482.00M
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 makes money primarily by producing crude oil, natural gas, and natural gas liquids (NGLs) from its operated and non-operated wells and selling those commodities to third-party purchasers. Revenue is driven by (1) production volumes...
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
12.82
Price Trends
10.73
Positive
9.57
Positive
8.91
Positive
Market Momentum
0.54
Negative
74.48
Negative
86.77
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 12.82 is above the 20-day moving average (MA) of 11.82, above the 50-day MA of 10.73, and above the 200-day MA of 8.91, indicating a bullish trend. The MACD of 0.54 indicates Negative momentum. The RSI at 74.48 is Negative, neither overbought nor oversold. The STOCH value of 86.77 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 |
|---|---|---|---|---|---|---|---|
73 Outperform | C$883.64M | 17.02 | 5.47% | 7.59% | -7.36% | ― | |
73 Outperform | C$1.10B | 2.80 | 24.42% | ― | 24.36% | -55.40% | |
72 Outperform | C$2.08B | 2.37 | 112.36% | ― | 194.52% | 10204.44% | |
67 Neutral | C$572.14M | 13.40 | 10.64% | ― | 40.83% | 26.01% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
62 Neutral | C$862.88M | 16.60 | -14.96% | ― | -11.85% | -307.86% |
* Energy Sector Average
TSE:OBE
Obsidian Energy
12.82
4.39
52.08%
TSE:SGY
Surge Energy
8.94
3.22
56.43%
TSE:TNZ
Tenaz Energy Corp
65.01
52.10
403.56%
TSE:SOIL
Saturn Oil & Gas
6.10
4.14
211.22%
TSE:LGN
Logan Energy Corp
0.99
0.33
50.00%
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.