Equinor ASA (EQNR) AI Stock Analysis

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Equinor ASA

(NYSE:EQNR)

72Outperform

Equinor ASA's overall stock score reflects a solid financial foundation with strong cash generation and an attractive valuation. However, challenges such as declining profitability, technical weaknesses, and the uncertainty of the Empire Wind project weigh on the score. The company's strategic initiatives and strong gas market performance are positives, but operational cost increases pose risks.

Positive Factors

Financial Performance

EQNR guided liquids realizations 3% higher than forecast and gas 4% higher than forecast, driving our revision.

Operational Developments

Near-term catalysts include Castberg startup and Empire Wind.

Production and Stability

EQNR reiterated an ability to maintain Norwegian production to 2035.

Negative Factors

Cash Distribution

The cash distribution outlook was disappointing.

Earnings Outlook

Lower near-term earnings are expected due to weakening commodity prices and lower buybacks as a result of more rapid build in leverage.

Leverage Concerns

The risk of Empire Wind getting canceled introduces potential for an increase in leverage in a weakening macro environment.

Equinor ASA (EQNR) vs. S&P 500 (SPY)

Market Cap

$64.52B

Dividend Yield4.98%

Average Volume (3M)4.27M

Price to Earnings (P/E)7.3

Beta (1Y)0.20

Revenue Growth3.96%

EPS Growth-1.69%

CountryUS

Employees24,126

SectorEnergy

Sector Strength49

IndustryOil & Gas Integrated

Share Statistics

EPS (TTM)0.66

Shares Outstanding2,792,781,300

10 Day Avg. Volume4,917,082

30 Day Avg. Volume4,265,990

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.19

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit1.84

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$25.31

Price Target Upside9.90% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering4

Equinor ASA Business Overview & Revenue Model

Company DescriptionEquinor ASA, an energy company, engages in the exploration, production, transportation, refining, and marketing of petroleum and petroleum-derived products, and other forms of energy in Norway and internationally. It operates through Exploration & Production Norway; Exploration & Production International; Exploration & Production USA; Marketing, Midstream & Processing; Renewables; and Other segments. The company also transports, processes, manufactures, markets, and trades in oil and gas commodities, such as crude and condensate products, gas liquids, natural gas, and liquefied natural gas; markets and trades in electricity and emission rights; operates refineries, terminals and processing, and power plants; and develops low carbon solutions for oil and gas. In addition, it develops wind, and carbon capture and storage projects, as well as offers other renewable energy. As of December 31, 2021, the company had proved oil and gas reserves of 5,356 million barrels of oil equivalent. Equinor ASA has collaboration agreements with Vårgrønn; and RWE Renewables and Hydro REIN. The company was formerly known as Statoil ASA and changed its name to Equinor ASA in May 2018. Equinor ASA was incorporated in 1972 and is headquartered in Stavanger, Norway.

How the Company Makes MoneyEquinor ASA generates revenue through various streams, primarily centered around its oil and gas operations. The company makes money by exploring and extracting crude oil and natural gas, which are then processed, refined, and sold to markets around the world. Additionally, Equinor operates midstream and downstream activities that include the transportation, refining, and marketing of oil and gas products. Moreover, Equinor is increasingly investing in renewable energy projects, such as offshore wind farms, which contribute to its revenue. The company also engages in strategic partnerships and collaborations to enhance its capabilities and expand its market reach. These efforts, combined with its focus on operational efficiency and cost management, help drive Equinor's profitability.

Equinor ASA Financial Statement Overview

Summary

Equinor ASA demonstrates strong operational efficiency and a stable balance sheet, although profitability has faced challenges with declining net profit margins. The company maintains robust cash generation but faces pressures on free cash flow growth. Overall, Equinor shows resilience in its financial structure, with areas for improvement in profitability and cash flow growth.

Income Statement

Positive

Equinor ASA's revenue has shown a mixed trend, decreasing significantly from 2022 to 2023 but slightly rebounding in TTM (Trailing-Twelve-Months). Gross profit margins remain strong at approximately 38% to 40%, indicating effective cost management. Net profit margins have decreased from 19.3% in 2022 to 8.2% in TTM, reflecting challenges in sustaining net income levels. The EBIT and EBITDA margins remain robust, highlighting operational efficiency.

Balance Sheet

Positive

The company's debt-to-equity ratio is stable, with total debt reduced slightly over the periods, showing prudent financial management. Stockholders' equity has grown consistently, enhancing financial stability. The equity ratio stands strong at around 33% in TTM, indicating a solid capital structure. Return on equity has decreased, aligning with reduced net income, suggesting pressure on profitability.

Cash Flow

Positive

Operating cash flow remains strong, although free cash flow has decreased in TTM compared to previous periods, indicating increased capital expenditures. The operating cash flow to net income ratio is favorable, suggesting strong cash generation capabilities. However, free cash flow growth rate is negative in TTM, showing potential challenges in maintaining free cash flow levels.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
102.50B	106.85B	149.00B	88.74B	45.75B
	Gross Profit
41.93B	48.04B	88.81B	41.87B	9.53B
	EBIT
30.93B	35.77B	78.81B	33.66B	-2.87B
	EBITDA
39.56B	50.18B	85.75B	42.98B	6.60B
	Net Income Common Stockholders
8.81B	11.88B	28.75B	8.56B	-5.50B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
23.45B	38.87B	45.45B	33.28B	18.62B
	Total Assets
131.14B	143.58B	158.02B	147.12B	121.97B
	Total Debt
30.09B	31.80B	32.17B	36.24B	38.12B
	Net Debt
21.97B	22.16B	16.59B	24.21B	31.36B
	Total Liabilities
88.76B	95.08B	104.03B	108.10B	88.08B
	Stockholders Equity
42.34B	48.49B	53.99B	39.01B	33.87B
Cash Flow		Free Cash Flow
7.93B	14.13B	26.38B	20.78B	1.91B
	Operating Cash Flow
20.11B	24.70B	35.14B	28.82B	10.39B
	Investing Cash Flow
-3.53B	-12.41B	-15.86B	-16.21B	-12.09B
	Financing Cash Flow
-17.74B	-18.14B	-15.41B	-4.84B	2.99B

Equinor ASA Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price23.03

Price Trends

50DMA

23.83

Negative

100DMA

23.56

Negative

200DMA

23.75

Negative

Market Momentum

MACD

-0.27

Negative

RSI

47.46

Neutral

STOCH

56.49

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EQNR, the sentiment is Neutral. The current price of 23.03 is above the 20-day moving average (MA) of 23.01, below the 50-day MA of 23.83, and below the 200-day MA of 23.75, indicating a neutral trend. The MACD of -0.27 indicates Negative momentum. The RSI at 47.46 is Neutral, neither overbought nor oversold. The STOCH value of 56.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EQNR.

Equinor ASA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TTE	76 Outperform	$121.49B	9.42	11.75%	4.71%	-9.86%	-32.59%
SHEL	74 Outperform	$196.47B	15.27	7.40%	4.20%	-2.62%	-20.13%
E	74 Outperform	$43.90B	15.96	4.78%	4.95%	-2.17%	-25.00%
EQNR	72 Outperform	$64.52B	7.27	18.28%	4.98%	3.96%	-1.69%
PBR	66 Neutral	$70.05B	10.64	10.52%	15.56%	-10.81%	-70.65%
BP	62 Neutral	$74.02B	186.20	-1.87%	6.24%	-7.70%	-113.83%
Sector *	56 Neutral	$7.06B	3.68	-4.87%	5.83%	0.28%	-51.94%

* Energy Sector Average

Performance Comparison

EQNR

Equinor ASA

23.03

-3.13

-11.96%

29.77

-6.28

-17.42%

Eni SPA

29.44

-1.81

-5.79%

PBR

Petroleo Brasileiro SA- Petrobras

11.80

-3.00

-20.27%

SHEL

Shell

66.15

-5.11

-7.17%

TTE

TotalEnergies

58.81

-12.03

-16.98%

Equinor ASA Earnings Call Summary

Earnings Call Date:Apr 30, 2025

(Q1-2025)

% Change Since: -0.22%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Neutral

The earnings call revealed strong financial results driven by gas production and a robust financial position, but was overshadowed by the uncertainty surrounding the Empire Wind project halt and some operational cost increases.

Q1-2025 Updates

Positive Updates

Strong Gas Production and Financial Performance

Gas production was particularly strong in Norway and the US, capturing higher prices. Adjusted operating income was reported at $8.6 billion before tax, with a strong cash flow from operations after tax at $7.4 billion.

Solid Financial Position and Capital Distribution

Equinor maintains a strong cash position of around $25 billion and a net debt ratio below 7%. The board approved an ordinary cash dividend of 37 cents per share and a second tranche of share buyback of up to $1.26 billion, totaling an expected $9 billion in capital distribution for the year.

Record Low Incident Frequency

The incident frequency reached a record low of 0.28, and the total recordable injury frequency was 2.2 per million hours worked over the last 12 months.

Positive Impact of U.S. Gas Market Strategy

Realized U.S. gas price was $4.06, a 74% increase from the same quarter last year, driven by strategic marketing and trading practices.

Negative Updates

Empire Wind Project Halt

BOEM issued an order to halt all ongoing activities related to the Empire Wind project, creating significant uncertainty and potential financial exposure of $1.5 to $2 billion.

Lower Oil Production and Trading Results

Oil production was somewhat lower than the same quarter last year. MMP came in below the guided range, impacted by lower liquids and LNG trading results and drilling costs.

Increased Operational Costs

Reported adjusted OpEx and SG&A increased by 11%, impacted by a change in over/under lift positions, increased transportation costs, and royalties.

Company Guidance

During the Equinor Analyst Call for the first quarter of fiscal year 2025, Torgrim Reitan, the CFO, provided insights into the company's financial performance and strategic developments. Equinor reported an adjusted operating income of $8.6 billion before tax and a net income of $2.6 billion. The company's cash flow from operations after tax stood at $7.4 billion, with an adjusted earnings per share of $0.66 and net income-based earnings per share of $0.97. Equinor's strong cash position was highlighted, with around $25 billion in cash and cash equivalents, and a net debt ratio of below 7%. Additionally, the company maintained its guidance for a $9 billion capital distribution for the year, including a dividend of 37 cents per share and a share buyback program. The call also addressed the challenges faced by the Empire Wind project, with a current book value of $2.5 billion, emphasizing the project's importance to Equinor and its commitment to engaging with the U.S. administration to resolve the situation. Safety remained a priority, with an incident frequency of 0.28 and a total recordable injury frequency of 2.2 per million hours worked. Gas production was strong, especially in Norway and the U.S., capturing higher prices, while the company's realized U.S. gas price was $4.06, a notable increase from the previous year. The impact of global economic uncertainties, including increased tariffs and potential trade wars, was also noted as creating volatility in the market.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.