As of May 27, 2025, Advantage Oil & Gas Ltd has a Discounted Cash Flow (DCF) derived fair value of $0.00 per share. With the current market price at $11.12, this represents a potential upside of -163.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $0.00 |
| DCF Fair Value (10-year) | $0.00 |
| Potential Upside (5-year) | -192.3% |
| Potential Upside (10-year) | -163.7% |
| Discount Rate (WACC) | 6.3% - 9.9% |
Revenue is projected to grow from $498 million in 12-2024 to $1905 million by 12-2034, representing a compound annual growth rate of approximately 14.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 498 | 2% |
| 12-2025 | 953 | 92% |
| 12-2026 | 1060 | 11% |
| 12-2027 | 1027 | -3% |
| 12-2028 | 1178 | 15% |
| 12-2029 | 1291 | 10% |
| 12-2030 | 1409 | 9% |
| 12-2031 | 1536 | 9% |
| 12-2032 | 1648 | 7% |
| 12-2033 | 1763 | 7% |
| 12-2034 | 1905 | 8% |
Net profit margin is expected to improve from 4% in 12-2024 to 10% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 20 | 4% |
| 12-2025 | 57 | 6% |
| 12-2026 | 74 | 7% |
| 12-2027 | 80 | 8% |
| 12-2028 | 102 | 9% |
| 12-2029 | 122 | 9% |
| 12-2030 | 135 | 10% |
| 12-2031 | 150 | 10% |
| 12-2032 | 163 | 10% |
| 12-2033 | 177 | 10% |
| 12-2034 | 194 | 10% |
with a 5-year average of $225 million. Projected CapEx is expected to maintain at approximately 48% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 285 |
| 12-2026 | 360 |
| 12-2027 | 411 |
| 12-2028 | 469 |
| 12-2029 | 533 |
| 12-2030 | 577 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 44 |
| Days Inventory | 0 |
| Days Payables | 0 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 250 | 13 | 346 | 26 | (135) |
| 2026 | 427 | 23 | 513 | 19 | (128) |
| 2027 | 488 | 25 | 497 | 6 | (40) |
| 2028 | 569 | 32 | 570 | 11 | (43) |
| 2029 | 656 | 38 | 624 | 17 | (23) |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 0.00 | -192.3% |
| 10-Year DCF (Growth) | 0.00 | -163.7% |
| 5-Year DCF (EBITDA) | 1.16 | -89.6% |
| 10-Year DCF (EBITDA) | 1.66 | -85.1% |
Is Advantage Oil & Gas Ltd (AAV.TO) a buy or a sell? Advantage Oil & Gas Ltd is definitely a sell. Based on our DCF analysis, Advantage Oil & Gas Ltd (AAV.TO) appears to be overvalued with upside potential of -163.7%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider reducing exposure at the current market price of $11.12.