MRC
MRC Global Inc.
$13.78
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Strong
·
Conviction
Undervalued
Trading 60.5% below fair value
You pay
$13.78
Bear
$18.39
Fair
$34.90
Bull
$55.65
Bear
$18.39
+33.5%
FCF $207M × 10x
Fair
$34.90
+153.3%
FCF $267M × 13x
Bull
$55.65
+303.9%
FCF $327M × 16x
Adjust Assumptions
75.0$/bbl
13.0x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
6.3x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (30 analysts)
$16.33
Divergence from AlphaVal
114%
Summary
At $75/bbl oil with a 13x EV/FCF multiple, intrinsic value is $34.90 per share. Range: $18.39 (bear) to $55.65 (bull).
Warnings
Debt per share ($5.98) 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.
Wall Street's average price target is $16.33 (from 30 analysts). Our estimate is 114% above the consensus -- consider that gap carefully.
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