As of June 2, 2025, PGS ASA's estimated intrinsic value ranges from $2.06 to $69.30 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $10.81 | +19.8% |
| Discounted Cash Flow (5Y) | $6.60 | -26.8% |
| Dividend Discount Model (Multi-Stage) | $2.06 | -77.2% |
| Dividend Discount Model (Stable) | $5.72 | -36.6% |
| Earnings Power Value | $69.30 | +668.1% |
Is PGS ASA (PGS.OL) undervalued or overvalued?
With the current market price at $9.02, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate PGS ASA's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.3% | 3.8% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.91 | 1.01 |
| Cost of equity | 8.0% | 10.5% |
| Cost of debt | 7.0% | 7.2% |
| Tax rate | 22.0% | 22.0% |
| Debt/Equity ratio | 0.99 | 0.99 |
| After-tax WACC | 6.7% | 8.1% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $1 | $1,225M | 84.5% |
| 10-Year Growth | $1 | $1,618M | 67.7% |
| 5-Year EBITDA | $1 | $1,779M | 89.3% |
| 10-Year EBITDA | $2 | $2,160M | 75.8% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $520M |
| Discount Rate (WACC) | 8.1% - 6.7% |
| Enterprise Value | $6,446M - $7,733M |
| Net Debt | $607M |
| Equity Value | $5,839M - $7,126M |
| Outstanding Shares | 955M |
| Fair Value | $6 - $7 |
| Selected Fair Value | $69.30 |
| Metric | Value |
|---|---|
| Market Capitalization | $8619M |
| Enterprise Value | $14821M |
| Trailing P/E | 20.00 |
| Forward P/E | 3880.01 |
| Trailing EV/EBITDA | 4.50 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.99 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $3.24 |
| Discounted Cash Flow (5Y) | 25% | $1.65 |
| Dividend Discount Model (Multi-Stage) | 20% | $0.41 |
| Dividend Discount Model (Stable) | 15% | $0.86 |
| Earnings Power Value | 10% | $6.93 |
| Weighted Average | 100% | $13.09 |
Based on our comprehensive valuation analysis, PGS ASA's weighted average intrinsic value is $13.09, which is approximately 45.1% above the current market price of $9.02.
Key investment considerations:
Given these factors, we believe PGS ASA is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.