Q: Please comment on the recent 2023 financials.
Do you think alv is worth holding, perhaps adding?
Thank you very much
Do you think alv is worth holding, perhaps adding?
Thank you very much
5i Research Answer:
ALV is a small-cap energy company that operates mainly in the natural gas field with projects located in Brazil, and is now trading at 3.5x times' Forward P/E. In the last few years, revenue growth and earnings were quite solid, as the company optimized production. The balance sheet is strong, with net cash of $11M. The company has been paying generous dividends due to its high free cash flow in the last few years. Going forward, the company’s operating results will largely depend on natural gas prices. Overall, it is a very cheap energy name, but the size and commodity price risks are quite significant here. Momentum is quite negative which also lowers our overall interest.