Is Anadarko Petroleum Corp Fairly Valued?

APC: Anadarko Petroleum logo
Anadarko Petroleum

Anadarko Petroleum Corp (NYSE: APC) posted strong improvement in its full-year 2017 results backed by a recovery in commodities prices during the year. The extension of production cuts by Organization of Petroleum and Exporting Countries (OPEC) and Non-OPEC allies would continue to remain beneficial for the company in the upcoming year. Additionally, APC’s focus on the three Ds in its portfolio — the Delaware basin, the DJ Basin, and the deepwater assets in the Gulf of Mexico (GOM) — will drive the value of the firm going forward. We estimate the company’s share price to be fairly valued at $61, close to its current market price.

Our price estimate is based on the assumption of $12.41 bil revenue in FY’18 and an EBITDA margin of ~30%. We expect a P/EBITDA Multiple of 8.89, slightly higher than that for FY’17. Average share count is estimated at 548 mil.

Relevant Articles
  1. How Will Anadarko Perform In 2019?
  2. Andarko 4Q: Andarko To See Improved Earnings But Cash Flow May Face Headwinds
  3. Anadarko Has Been Trading At A 52-Week Low. Where Will It Head Going Into 2019?
  4. Higher Oil Output And Improved Commodity Prices Will Drive Anadarko’s 3Q’18 Results
  5. Ramp Up Of Oil Production Will Drive Anadarko’s Value In The Near Term
  6. Key Takeaways From Anadarko’s Second Quarter Results

Our revenue estimate of $12.41 bil for 2018 is arrived at by projecting revenues for each individual segment. Expected sales volume for each of the divisions is multiplied by the expected average price to arrive at the segment-wise revenue figures.

Detailed steps to arrive at our price estimate are outlined in our interactive dashboardYou can modify our assumptions to arrive at your own price estimate for the company.


What’s behind Trefis? See How it’s Powering New Collaboration and What-Ifs

For CFOs and Finance Teams | Product, R&D, and Marketing Teams

More Trefis Research

Like our charts? Explore example interactive dashboards and create your own.