Buen artículo que sigue diciendo lo que más o menos sabemos, que es una empresa barata, está el riesgo geopolítico siempre presente, hay que esperar al 2020 a que se concreten los proyectos grandes, etc.
Como dos puntos a destacar: 1) una vez finalizado el plazo de 2020 no hay grandes proyectos en carpeta, por lo cuál hay rumores de que puede arranar una fuerte recompra por parte del management. 2) Hay un firme compromiso a seguir pagando jugosos dividendos a pesar de las grandes inversiones que se están realizando, el dividendo está en torno al 5.5%.
Dejo el artículo de SeekingAlpha:
https://seekingalpha.com/article/415169 ... of=45&dr=1
Summary
25 years since the creation of Gazprom.
Project's update and CapEx forecast.
Possible buyback program and a high dividend yield.
This year Gazprom (OTCPK:OGZPY) is 25 years old. Now, Gazprom is engaged in the construction of pipelines for gas exports to Europe and Asia. Investors do not much like the company and now it is trading at 4x its earnings. But in my opinion, 2018-2019 should bring changes in the mood of investors. Firstly, due to the completion of construction projects happening soon and an announced buyback program.
Gazprom is a Russian transnational energy corporation. The state controls over 50% of the shares. It's one of the world's largest energy companies, according to S&P Global Platts.
The share of available gas reserves is 17% of the world and 72% of the Russian supplies. Gazprom accounts for 11% of the world and 66% of Russian gas production. It has a monopoly on the export of pipeline gas in Russia.
Projects
Gazprom is engaged in the construction of several pipelines, which greatly affects the CapEx of the company. Almost every day there are various news reports about problems with this construction. At the same time, the potential of these pipelines is huge, and after construction, it will allow Gazprom to increase its free cash flow.
Nord Stream-2
One of the most important projects for the company, the launch is planned for the end of 2019. According to management forecasts, this project will bring an additional $1 billion of EBITDA as a cost reduction compared to supplies received through Ukraine. Also, just a few days ago, there was information that Germany had allowed the construction of this turbine pipeline on its territory. And as chairman of the board - Alexey Miller says, other countries will follow the example of Germany.
Turkish Stream
This project is completed by half and the launch is planned for 2019. In total, the project is estimated at $7 billion and has a strategic importance for gas supplies to Turkey and southern Europe.
Power of Siberia
The project is coming to an end and the launch is planned for December 2019. This project will open a completely new market for Gazprom - the Chinese market.
Financials
In 2017, the company steadily increased its revenue from quarter to quarter and this dynamic should continue in 2018 due to the increased demand from Europe. Gazprom will be able to cover all the demand for several years ahead due to the presence of huge gas reserves, so the company expects a stable year from the position of revenue.
Due to the completion of most projects, 2018 will be a record year for the company in terms of CapEx, and management expects to reach 1.5 trillion rubles (about $25 billion) in 2018 and 1.6 trillion rubles in 2019. And if there is no change in the conditions for the construction of pipelines with the participating countries and some of the other factors to increase the cost of projects, Gazprom will be able to show a small positive cash flow as soon as the next two years.
At the same time, Gazprom does not plan any very large projects for the period after 2019, which makes it possible to guarantee a huge free cash flow.
Valuation
It's not a secret that Gazprom is one of the cheapest companies in the world and its P/E is 4x. The chart above shows the largest companies from the Oil and Gas sector, and Gazprom is several times cheaper than its competitors even in terms of EV/EBITDA despite the increased debt. The main reason for this undervaluation is the forecasts for the huge CapEx in the coming years. At the same time, as I said above, in the absence of serious political turmoil, the company's capital expenditures will bring a huge free cash flow after the completion of the construction of the projects. Therefore, despite all the negative, Gazprom is extremely cheap compared to its intrinsic value.
Dividends and Buyback
On February 20, information appeared that the board of directors would consider the possibility of a shares buyback. The meeting is scheduled for March 5, but the shares have already grown by 3% after the news. If the board of directors decides to buy back the shares, it will be a powerful signal that management believes in the future of the company and that the company is now undervalued. In this case, this buyback can be expected not earlier than 2020, after the completion of the investment projects.
Gazprom also steadily pays dividends and because of very long flat quotations, the company's shares are called "quasi-bond." Investors consistently have received a dividend yield close to 6% in recent years. And despite the huge CapEx, management promises to keep dividends at least at the level of last year. At the same time, as a dividend stock for your portfolio from the Russian Oil and Gas sector, it is possible to consider more profitable companies represented by Lukoil (OTCPK:LUKOY), Tatneft (OTCPK:OAOFY), or Gazprom's subsidiary Gazpromneft (OTCQX:GZPFY).
