Attracts Bought-Deal Financing to Fund Growth CAPEX

Published: 3/12/2024

Author: Sid Rajeev, B.Tech, CFA, MBA

Attracts Bought-Deal Financing to Fund Growth CAPEX - Main Image

*See important disclosures at the bottom of this report

Sector: Energy | Industry: Oil & Gas Equipment & Services

Ticker Symbols:

E.TO - TSX 🔹

ETOLF - NASDAQ 🔹

Rating and Key Data

Metrics	Value
Current Price	CAD $0.83
Fair Value	CAD $1.33
Risk	3
Week Range	CAD $0.37-0.93
Shares O/S (M)	58
Market Cap. (M)	CAD $48
Current Yield (%)	n/a
P/E (forward)	7.2
P/B	1.0

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Highlights

E is up 118% YoY, making it one of the best performing stocks on our list of oilfield services companies.

In 2023, EBITDA was up 61% YoY, missing our estimate by just 1%. Revenue was up 25% YoY, missing our estimate by 7% due to project delays caused by forest fires, and unusually warm weather in Q4. We anticipate that some of these projects will be rescheduled to H1-2024 and therefore, revenue from these projects has been deferred rather than lost.

Gross and EBITDA margins exceeded our estimates by 1 pp, and 3 pp, respectively.

Revenue growth came from new contracts with tier-one clients. Per consensus estimates, growth in North Americ

Rating and Key Data

Metrics	Value
Current Price	CAD $0.83
Fair Value	CAD $1.33
Risk	3
Week Range	CAD $0.37-0.93
Shares O/S (M)	58
Market Cap. (M)	CAD $48
Current Yield (%)	n/a
P/E (forward)	7.2
P/B	1.0