FECCF
Frontera Energy Corporation
$6.14
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Strong
·
Conviction
Undervalued
Trading 80.8% below fair value
You pay
$6.14
Bear
$14.43
Fair
$31.98
Bull
$55.38
Bear
$14.43
+135.0%
FCF $159M × 8x
Fair
$31.98
+420.8%
FCF $226M × 11x
Bull
$55.38
+802.0%
FCF $294M × 14x
Adjust Assumptions
75.0$/bbl
11.0x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
3.0x
Summary
At $75/bbl oil with a 11x EV/FCF multiple, intrinsic value is $31.98 per share. Range: $14.43 (bear) to $55.38 (bull).
Warnings
Debt per share ($3.77) is significant relative to the stock price. Even small changes in the debt figure meaningfully shift what each share is worth.
Where you think oil prices will settle long-term drives over 80% of this valuation. The biggest risk isn't the company itself — it's getting the commodity price wrong.
This stock is 48% below its 52-week high, with weak or declining earnings. That combination often signals real trouble, even though the valuation below is based on other fundamentals.
Key Risks
- Growth DCF inappropriate — commodity volumes do not compound
- Geopolitical premiums are real but historically temporary
- Reserve replacement ratio below 100% for 3 years is existential