PXD
Pioneer Natural Resources Company
$269.62
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Strong
·
Conviction
Overvalued
Trading 67.3% above fair value
You pay
$269.62
Bear
$72.13
Fair
$161.12
Bull
$279.78
Bear
$72.13
-73.2%
FCF $2792M × 8x
Fair
$161.12
-40.2%
FCF $3988M × 11x
Bull
$279.78
+3.8%
FCF $5185M × 14x
Adjust Assumptions
75.0$/bbl
11.0x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
17.6x
Summary
At $75/bbl oil with a 11x EV/FCF multiple, intrinsic value is $161.12 per share. Range: $72.13 (bear) to $279.78 (bull).
Warnings
If oil drops to $60/barrel, the stock could fall -73%. Check whether the company can survive at low prices and still pay its dividend.
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.
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