Today is Wednesday, January 22, 2020, and this is your daily oil stocks roundup. Today we're looking at the valuations of World Fuel Services Corporation (NYSE: INT), Archrock (NYSE: AROC), and CNX Resources Corporation (NYSE: CNX).
World Fuel Services Corporation (NYSE: INT) is a $2.682 billion company today with a one-year return of 67.04%. Let's look at its price-to-earnings (P/E) ratio, its enterprise-value-to-free-cash-flow (EV/CF) ratio, and its debt-to-equity ratio to gauge whether or not it's a good investment.
The company's P/E ratio of 18.07 is 25.40% higher than the industry average of 14.41. That's not good. A company's P/E ratio shows its price as a multiple of its earnings per share (EPS). A relatively high P/E ratio is generally an indicator that a company is overvalued.
World Fuel Services Corporation's enterprise-value-to-free-cash-flow (EV/FCF) ratio of 14.6 is 20.04% lower than its industry average of 18.26. That's good.
A company's EV/FCF ratio measures its enterprise value (market cap adjusted for cash holdings and debt) against its free cash flow (how much money the company has after all of its cash outflows). A low EV/FCF ratio indicates that a company is performing efficiently, managing its debt well, and maintaining a strong cash position.
The debt-to-equity (D/E) ratio of World Fuel Services Corporation has decreased by 11.25% over the last year. That's good.
A company's D/E ratio equals its total liabilities divided by its shareholder equity. It's a measure of a company's financial leverage. A declining D/E ratio indicates that a company is decreasing its debt burden over time, while a rising ratio indicates that a company is taking on more debt over time.
World Fuel Services Corporation has scored favorably on 2 of our 3 valuation metrics. With this in mind, we believe the stock is a good value.
Archrock (NYSE: AROC) is a $1.387 billion company today with a one-year return of -2.8%. Judging by its price-to-earnings (P/E) ratio, its enterprise-value-to-free-cash-flow (EV/CF) ratio, and its debt-to-equity ratio, is it a good investment?
The company's P/E ratio of 19.02 is 26.11% lower than the industry average of 25.74. That's good.
Archrock's enterprise-value-to-free-cash-flow (EV/FCF) ratio of -31.66 is below zero. That's not good.
The debt-to-equity (D/E) ratio of Archrock has decreased by 5.68% over the last year. That's good.
Archrock has scored favorably on 2 of our 3 valuation metrics. With this in mind, we believe the stock is a good value.
CNX Resources Corporation (NYSE: CNX) is a $1.276 billion company today with a one-year return of -47.99%. Is it a good value based on its price-to-earnings (P/E) ratio, its enterprise-value-to-free-cash-flow (EV/CF) ratio, and its debt-to-equity ratio?
The company's P/E ratio of 4.53 is 45.04% lower than the industry average of 8.242. That's good.
CNX Resources Corporation's enterprise-value-to-free-cash-flow (EV/FCF) ratio of -21 is below zero. That's not good.
The debt-to-equity (D/E) ratio of CNX Resources Corporation has increased by 17.46% over the last year. That's not good.
CNX Resources Corporation has scored favorably on 1 of our 3 valuation metrics. With this in mind, we believe the stock is slightly overvalued.
To summarize, we believe World Fuel Services Corporation (NYSE: INT) is a good value, Archrock (NYSE: AROC) is a good value, and CNX Resources Corporation (NYSE: CNX) is slightly overvalued.
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