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Magnum Hunter Resources Corporation
MHR : NYSE : Basic Materials
$4.89 | %
Today's Range: 4.78 - 4.98
Avg. Daily Volume: 5,820,000
11/21/14 - 4:03 PM ET

Financial Analysis


MAGNUM HUNTER RESOURCES CORP's gross profit margin for the third quarter of its fiscal year 2014 has significantly decreased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. MAGNUM HUNTER RESOURCES CORP has very weak liquidity. Currently, the Quick Ratio is 0.36 which clearly shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has decreased by 16.76% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY14 Q3 FY13
Net Sales ($mil)79.6773.03
EBITDA ($mil)-29.2116.34
EBIT ($mil)-65.58-51.72
Net Income ($mil)-120.68-296.88


Balance Sheet Q3 FY14 Q3 FY13
Cash & Equiv. ($mil)50.957.52
Total Assets ($mil)2033.571885.82
Total Debt ($mil)958.46753.28
Equity ($mil)607.17729.44


Profitability Q3 FY14 Q3 FY13
Gross Profit Margin21.7553.28
EBITDA Margin-36.6522.37
Operating Margin-82.31-70.82
Sales Turnover0.20.13
Return on Assets-14.43-13.3
Return on Equity-48.22-41.03
Debt Q3 FY14 Q3 FY13
Current Ratio0.40.63
Debt/Capital0.610.51
Interest Expense0.016.27
Interest Coverage0.0-3.18


Share Data Q3 FY14 Q3 FY13
Shares outstanding (mil)199.9170.69
Div / share0.00.0
EPS-0.68-0.86
Book value / share3.044.27
Institutional Own % n/a n/a
Avg Daily Volume5739200.03603401.0

Valuation


SELL. This stock?s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. To use another comparison, its price-to-book ratio of 1.54 indicates a discount versus the S&P 500 average of 2.73 and a significant discount versus the industry average of 13.39. The current price-to-sales ratio is well above the S&P 500 average, but below the industry average. After reviewing these and other key valuation criteria, MAGNUM HUNTER RESOURCES CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
MHR NM Peers 49.05   MHR 18.30 Peers 7.92

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

MHR's P/E is negative making this valuation measure meaningless.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

MHR is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
MHR NM Peers 17.48   MHR NA Peers 2.57

Neutral. The absence of a valid price-to-projected earnings ratio happens when a stock can not be valued on the basis of a negative expected future earnings.

MHR's ratio is negative making this valuation measure meaningless.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
MHR 1.54 Peers 13.39   MHR 12.93 Peers 55.61

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

MHR is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, MHR is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
MHR 2.31 Peers 2.45   MHR 68.26 Peers 9.41

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

MHR is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

MHR has a sales growth rate that significantly exceeds its peers.

 

 

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