APA Corporation
APA Corporation Fundamental Analysis
APA Corporation (APA) shows strong financial fundamentals with a PE ratio of 6.96, profit margin of 15.65%, and ROE of 26.72%. The company generates $9.5B in annual revenue with strong year-over-year growth of 17.61%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 73.4/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze APA's fundamental strength across five key dimensions:
Efficiency Score
WeakAPA struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAPA trades at attractive valuation levels.
Growth Score
ModerateAPA shows steady but slowing expansion.
Financial Health Score
ModerateAPA shows balanced financial health with some risks.
Profitability Score
ExcellentAPA achieves industry-leading margins.
Key Financial Metrics
Is APA Expensive or Cheap?
P/E Ratio
APA trades at 6.96 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, APA's PEG of 0.18 indicates potential undervaluation.
Price to Book
The market values APA Corporation at 1.76 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 1.10 times EBITDA. This is generally considered low.
How Well Does APA Make Money?
Net Profit Margin
For every $100 in sales, APA Corporation keeps $15.65 as profit after all expenses.
Operating Margin
Core operations generate 30.57 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $26.72 in profit for every $100 of shareholder equity.
ROA
APA Corporation generates $8.53 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
APA Corporation generates strong operating cash flow of $4.69B, reflecting robust business health.
Free Cash Flow
APA Corporation generates strong free cash flow of $1.87B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.27 in free cash annually.
FCF Yield
APA converts 18.45% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
6.96
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.18
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.76
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.07
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.77
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.78
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.27
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.19
vs 25 benchmark
How APA Stacks Against Its Sector Peers
| Metric | APA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 6.96 | 20.19 | Better (Cheaper) |
| ROE | 26.72% | 1019.00% | Weak |
| Net Margin | 15.65% | -44017.00% (disorted) | Strong |
| Debt/Equity | 0.77 | -0.65 (disorted) | Distorted |
| Current Ratio | 0.78 | 4.60 | Weak Liquidity |
| ROA | 8.53% | -11655350.00% (disorted) | Weak |
APA outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews APA Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
64.67%
Industry Style: Cyclical, Value, Commodity
High GrowthEPS CAGR
124.17%
Industry Style: Cyclical, Value, Commodity
High GrowthFCF CAGR
34.85%
Industry Style: Cyclical, Value, Commodity
High Growth