Paramount Resources (POU) AI Stock Analysis

• Market Cap: $2.85B
• Dividend Yield: 5.43%
• Average Volume (3M): 268.44K
• Price to Earnings (P/E): 1.9
• Beta (1Y): 1.03
• Revenue Growth: -18.29%
• EPS Growth: 317.52%
• Country: CA
• Employees: 566
• Sector: Energy
• Sector Strength: 53
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.03
• Shares Outstanding: 143,578,800
• 10 Day Avg. Volume: 299,191
• 30 Day Avg. Volume: 268,437
• PEG Ratio: -0.46
• Price to Book (P/B): 1.26
• Price to Sales (P/S): 2.24
• P/FCF Ratio: -112.76
• Enterprise Value/Market Cap: 0.92
• Enterprise Value/Revenue: 1.70
• Enterprise Value/Gross Profit: 4.37
• Enterprise Value/Ebitda: 1.20
• 1Y Price Target: $24.25
• Price Target Upside: 19.82% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 61 Neutral
• Price Target: C$20.50 ▲(1.28% Upside)

Paramount Resources' overall stock score is primarily influenced by its strong valuation, with a low P/E ratio and high dividend yield. However, financial performance concerns, particularly declining revenue and negative free cash flow, along with bearish technical indicators, weigh down the score.

Positive Factors

Financial Flexibility

Paramount sits on a net cash position, providing financial stability and flexibility for future opportunities.

Financial Performance

Paramount Resources Ltd posted a production and cash flow per share beat, enhancing investor confidence in its financial performance.

Operational Developments

The first phase of the Alhambra plant at Willesden Green is complete and will start ahead of schedule, demonstrating effective project management.

Negative Factors

Asset Valuation

Paramount is a unique E&P business with non-producing or hard-to-value assets that have generally been ignored by investors, which could obscure true asset valuation.

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 only $0.57 in value.

Paramount Resources Business Overview & Revenue Model

Company Description

Paramount Resources Ltd. is a Canadian oil and natural gas exploration and production company based in Calgary, Alberta. The company operates primarily in the Western Canadian Sedimentary Basin, focusing on the exploration, development, and production of crude oil and natural gas liquids. Paramount is involved in several sectors of the energy industry, including upstream oil and gas production, as well as midstream operations related to the transportation and processing of hydrocarbons. Its core products include light and heavy crude oil, natural gas, and natural gas liquids, catering to both domestic and international markets.

How the Company Makes Money

Paramount Resources generates revenue primarily through the sale of crude oil, natural gas, and natural gas liquids. The company monetizes its production by selling these resources to various customers, including refiners, marketers, and other energy companies. Key revenue streams include the sale of production from its operated and non-operated properties, as well as income from its midstream operations, which may involve transportation and processing fees. Additionally, Paramount may engage in strategic partnerships and joint ventures to enhance its production capabilities or share costs, thereby contributing to its overall earnings. The pricing of its products is influenced by global commodity markets, making fluctuations in oil and gas prices a significant factor in its revenue streams.

Paramount Resources Financial Statement Overview

Summary

Paramount Resources presents strong profitability with robust margins and excellent returns on equity, highlighting effective cost management and shareholder value creation. However, declining revenue and negative free cash flow pose challenges that need addressing. The low debt levels and strong equity position provide financial stability, but cash flow concerns suggest the need for improved cash management strategies.

Income Statement

Paramount Resources shows a mixed performance in its income statement. The TTM Gross Profit Margin stands at 45.07%, indicating strong profitability from operations. However, the company's revenue has seen a decline of approximately 9.47% in the latest TTM period compared to the last annual report, which is a concern. The Net Profit Margin has surged to 82.75% in the TTM, largely due to a substantial net income, reflecting strong cost management or one-time financial benefits. EBITDA and EBIT margins are also healthy at 126.56% and 16.63% respectively, showcasing operational efficiency. Despite revenue contraction, the overall margins suggest robust profitability.

Balance Sheet

The balance sheet of Paramount Resources indicates financial stability. The Debt-to-Equity Ratio is exceptionally low at 0.01, reflecting minimal leverage and a strong equity position. The Return on Equity (ROE) in the TTM is a remarkable 58.84%, driven by significant net income, suggesting efficient use of shareholder funds. The Equity Ratio stands at 73.12%, indicating a solid capital structure with a high proportion of equity financing. Despite a declining asset base, the financial health appears strong due to minimal debt obligations.

Cash Flow

Paramount Resources' cash flow statement reveals mixed results. The Free Cash Flow is negative in the latest TTM, indicating potential issues with capital expenditure management or cash generation. However, the Operating Cash Flow to Net Income Ratio is 0.49, suggesting that only about half of the net income is backed by operating cash flows, which may imply earnings quality concerns. The Free Cash Flow to Net Income Ratio is negative due to the negative free cash flow, highlighting potential liquidity challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.54B	2.08B	1.80B	2.52B	1.38B	626.04M
Gross Profit	600.50M	991.80M	960.90M	1.46B	841.00M	239.51M
EBITDA	2.19B	876.90M	1.05B	1.20B	841.90M	338.47M
Net Income	1.48B	335.90M	470.20M	680.60M	236.90M	-22.69M
Balance Sheet
Total Assets	3.52B	4.76B	4.39B	4.34B	3.89B	3.50B
Cash, Cash Equivalents and Short-Term Investments	561.80M	2.40M	48.90M	2.50M	1.70M	4.59M
Total Debt	27.50M	201.90M	29.20M	177.40M	398.90M	835.21M
Total Liabilities	839.40M	1.06B	889.50M	959.20M	1.28B	1.46B
Stockholders Equity	2.68B	3.70B	3.50B	3.38B	2.61B	2.04B
Cash Flow
Free Cash Flow	-192.80M	-41.20M	126.90M	248.80M	202.10M	-140.34M
Operating Cash Flow	583.00M	815.30M	938.20M	1.05B	482.10M	80.91M
Investing Cash Flow	2.49B	-762.40M	-376.70M	-654.00M	-51.70M	-250.02M
Financing Cash Flow	-2.55B	-99.40M	-514.90M	-393.20M	-433.30M	168.37M

Paramount Resources Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 20.24
• 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:POU, the sentiment is Positive. The current price of 20.24 is below the 20-day moving average (MA) of 20.51, below the 50-day MA of 21.19, and above the 200-day MA of 17.66, indicating a neutral trend. The MACD of -0.34 indicates Positive momentum. The RSI at 45.92 is Neutral, neither overbought nor oversold. The STOCH value of 33.38 is Neutral, 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
ATH	76 Outperform	$2.91B	6.95	27.01%	―	5.67%	479.45%
NVA	74 Outperform	$2.86B	8.59	14.64%	―	-9.78%	5.12%
FRU	69 Neutral	$2.19B	17.46	11.89%	7.98%	-0.92%	-23.14%
BTE	67 Neutral	$2.16B	5.97	9.05%	3.05%	-7.76%	―
IPCO	67 Neutral	C$2.90B	41.64	5.46%	―	-17.88%	-67.55%
POU	61 Neutral	$2.85B	1.95	44.56%	5.43%	-18.29%	317.52%
Sector *	54 Neutral	C$4.22B	1.19	16.40%	5.06%	10.17%	-54.09%

Paramount Resources Corporate Events

Paramount Resources Boosts 2025 Production Guidance with Early Alhambra Plant Start-Up

Paramount Resources Ltd. reported its second quarter 2025 results, highlighting the early start-up of its Alhambra Plant in Willesden Green, which has led to an increase in production guidance for the year. The company’s sales volumes averaged 31,631 Boe/d, with significant contributions from the Duvernay formation. The early completion of the Alhambra Plant is expected to enhance production capacity, with annual sales volumes now projected to be between 38,500 and 42,500 Boe/d. Paramount maintains a strong financial position with net cash of $501 million and an undrawn credit facility, while also declaring a dividend for shareholders.

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 June Dividend

Paramount Resources Ltd. announced a cash dividend of $0.05 per common share, payable on June 30, 2025, to shareholders of record on June 16, 2025. This dividend is designated as an ‘eligible dividend’ for Canadian income tax purposes, reflecting the company’s ongoing commitment to returning value to shareholders.

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 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.