Paramount Resources (POU) AI Stock Analysis

• Market Cap: $2.78B
• Dividend Yield: 22.95%
• Average Volume (3M): 544.49K
• Price to Earnings (P/E): 1.8
• Beta (1Y): 0.98
• Revenue Growth: 2.95%
• EPS Growth: 351.05%
• Country: CA
• Employees: 566
• Sector: Energy
• Sector Strength: 45
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 8.74
• Shares Outstanding: 143,479,630
• 10 Day Avg. Volume: 656,073
• 30 Day Avg. Volume: 544,487
• PEG Ratio: -0.96
• Price to Book (P/B): 0.63
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -57.40
• 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: $22.52
• Price Target Upside: 16.09% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 75 Outperform
• Price Target: C$20.50 ▲(5.67%Upside)

Paramount Resources demonstrates solid financial health, particularly with a strong balance sheet and attractive valuation metrics. The company's strategic asset sales and shareholder returns further reinforce its market position. However, operational challenges, including cash flow inefficiencies and technical indicators suggesting potential overvaluation, warrant cautious optimism.

Positive Factors

Asset Potential

Paramount is a unique E&P business with a number of non-producing/hard-to-value assets that have generally been ignored by investors, which could present untapped potential.

Financial Stability

The company sits on a net cash position, which provides financial stability and flexibility.

Operational Confidence

Paramount's 2025 production guidance was maintained, indicating confidence in its operational plans and projections.

Shareholder Returns

POU plans to pay shareholders a special distribution of $15/sh, which includes a return of capital and a special dividend.

Negative Factors

Profitability Concerns

Profitability is measured by comparing the change in PDP reserve value to the amount of capital employed, showing that for every dollar spent, management added $0.57 in value.

Valuation Concerns

With the company recently paying the special dividend of $15, the Target Price is being lowered to $25.

Paramount Resources Business Overview & Revenue Model

Company Description

Paramount Resources Ltd., an independent energy company, explores for, develops, produces, and markets natural gas, crude oil, and natural gas liquids in Canada. The company's principal properties are the Montney and Duvernay developments located in Alberta and British Columbia. It also invests in public and private corporations. Paramount Resources Ltd. was founded in 1976 and is based in Calgary, Canada.

How the Company Makes Money

Paramount Resources makes money through the production and sale of hydrocarbons, including natural gas and crude oil. The company's revenue primarily comes from the extraction and sale of these resources, which are sold to various markets, including domestic and international buyers. Significant revenue streams include the sale of natural gas liquids (NGLs) and condensates, which are by-products of natural gas extraction and are sold as valuable feedstocks for petrochemical production. Additionally, Paramount Resources may engage in joint ventures and strategic partnerships to optimize resource development and share risks. The company's earnings are influenced by factors such as commodity prices, production volumes, and operational efficiencies. Paramount Resources also focuses on cost management and technological advancements to enhance its profitability and competitiveness in the energy sector.

Paramount Resources Financial Statement Overview

Summary

Paramount Resources demonstrates stable financial performance with strong equity and controlled leverage. Despite profitability, operational challenges are evident in revenue and net income volatility, alongside cash flow inefficiencies, indicating areas for improvement.

Income Statement

Paramount Resources shows a mixed income statement performance. The gross profit margin has been robust, supported by relatively stable gross profits over the years. However, the net profit margin has seen fluctuations, reflecting variability in net income. The revenue growth rate is inconsistent, indicating potential volatility in sales. EBIT and EBITDA margins are healthy, although the absence of EBIT in the latest year suggests operational challenges.

Balance Sheet

The company's balance sheet is strong, with a low debt-to-equity ratio indicating limited leverage risk. Return on Equity (ROE) remains solid, demonstrating effective use of shareholder capital despite some variability across years. The equity ratio is consistently healthy, emphasizing substantial equity backing relative to assets.

Cash Flow

Cash flow statements reveal a decline in free cash flow growth, raising concerns about cash generation efficiency. Operating cash flow remains strong compared to net income, indicating good cash conversion from operations. However, the free cash flow to net income ratio is negative in the latest year, signaling potential cash flow issues.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.08B	1.80B	2.52B	1.38B	626.04M
	Gross Profit
991.80M	960.90M	1.46B	841.00M	239.51M
	EBIT
0.00	867.90M	989.30M	206.20M	-95.51M
	EBITDA
819.90M	1.05B	1.20B	841.90M	338.47M
	Net Income Common Stockholders
335.90M	470.20M	680.60M	236.90M	-22.69M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.40M	48.90M	2.50M	1.70M	4.59M
	Total Assets
4.76B	4.39B	4.34B	3.89B	3.50B
	Total Debt
201.90M	29.20M	177.40M	398.90M	835.21M
	Net Debt
199.50M	-19.70M	174.90M	397.20M	830.62M
	Total Liabilities
1.06B	889.50M	959.20M	1.28B	1.46B
	Stockholders Equity
3.70B	3.50B	3.38B	2.61B	2.04B
Cash Flow		Free Cash Flow
-41.20M	126.90M	248.80M	202.10M	-140.34M
	Operating Cash Flow
815.30M	938.20M	1.05B	482.10M	80.91M
	Investing Cash Flow
-762.40M	-376.70M	-654.00M	-51.70M	-250.02M
	Financing Cash Flow
-99.40M	-514.90M	-393.20M	-433.30M	168.37M

Paramount Resources Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:POU, the sentiment is Positive. The current price of 19.4 is above the 20-day moving average (MA) of 17.50, above the 50-day MA of 17.12, and above the 200-day MA of 15.55, indicating a bullish trend. The MACD of 0.80 indicates Negative momentum. The RSI at 74.46 is Negative, neither overbought nor oversold. The STOCH value of 90.51 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:POU.

Paramount Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
POU	75 Outperform	$2.78B	1.81	48.97%	22.95%	2.95%	351.05%
Sector *	57 Neutral	$7.06B	3.04	-3.49%	5.80%	0.53%	-50.39%
BTE		$1.27B	5.63	8.02%	4.01%	―	―
ATHOF		$1.91B	5.61	30.45%	―	―	―
FRHLF		$1.49B	12.79	15.22%	8.56%	―	―
NUVSF		$2.04B	7.62	16.78%	―	―	―
IPCO	66 Neutral	C$2.20B	20.38	8.83%	―	-7.83%	-45.69%

Paramount Resources Corporate Events

Paramount Resources Announces AGM Results and Auditor Re-appointment

Paramount Resources Ltd. announced the election of nine director nominees at its annual general meeting, with all candidates receiving strong support from shareholders. Additionally, the re-appointment of Ernst & Young LLP as auditors was approved. This reflects a stable governance structure and continued confidence in the company’s strategic direction, potentially reinforcing its market position and stakeholder trust.

The most recent analyst rating on (TSE:POU) stock is a Hold with a C$34.00 price target. To see the full list of analyst forecasts on Paramount Resources stock, see the TSE:POU Stock Forecast page.

Paramount Resources Reports Strong Q1 2025 Results and Sinclair Update

Paramount Resources Ltd. reported its first quarter 2025 financial results, highlighting an average sales volume of 54,409 Boe/d and cash from operating activities totaling $150 million. The company completed the sale of its Karr, Wapiti, and Zama properties for $3.3 billion, which allowed for a special cash distribution to shareholders and the establishment of a new credit facility. Paramount also provided an update on its Sinclair Montney property, where it completed and tested two appraisal wells, achieving promising production rates. The company continues to hedge its liquids and manage its asset retirement obligations while maintaining a strong cash position.

The most recent analyst rating on (TSE:POU) stock is a Hold with a C$34.00 price target. To see the full list of analyst forecasts on Paramount Resources stock, see the TSE:POU Stock Forecast page.

Paramount Resources Declares May Dividend

Paramount Resources Ltd. announced a cash dividend of $0.05 per common share, payable on May 30, 2025, to shareholders of record on May 15, 2025. This declaration reflects the company’s ongoing commitment to returning value to shareholders, although future dividends are subject to change based on various financial and market conditions.

Paramount Resources Declares April Dividend

Paramount Resources Ltd. has announced a cash dividend of $0.05 per common share, payable on April 30, 2025, to shareholders of record as of April 15, 2025. This dividend is designated as an ‘eligible dividend’ for Canadian income tax purposes. The announcement reflects Paramount’s ongoing commitment to delivering shareholder value, although the company notes potential risks that could affect future dividend declarations, including changes in market conditions and financial requirements.

Paramount Resources Reports Strong 2024 Financial Results and Strategic Asset Sale

Paramount Resources Ltd. announced its 2024 annual financial results, highlighting the sale of its Karr, Wapiti, and Zama properties to Ovintiv Inc. for approximately $3.3 billion. This transaction allowed Paramount to distribute a special cash dividend to shareholders and repurchase shares. The company reported record annual sales volumes and significant cash flow from operations, indicating strong financial performance and strategic repositioning within the industry.