RES
RPC, Inc.
$5.85
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Moderate
·
Conviction
Overvalued
Trading 22.3% above fair value
You pay
$5.85
Bear
$3.13
Fair
$4.78
Bull
$6.87
Bear
$3.13
-46.5%
FCF $41M × 10x
Fair
$4.78
-18.2%
FCF $53M × 13x
Bull
$6.87
+17.5%
FCF $65M × 16x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
22.3x
Summary
Our base-case estimate uses a valuation based on free cash flow under different commodity price assumptions and a valuation multiple. We then blend that result with the average analyst price target of $7.50 from 36 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $4.78 per share.
Warnings
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 $7.50 (from 36 analysts). Our estimate is 52% below 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