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Vermilion Energy
(TSX:VET)
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Rating:62Neutral
Price Target:
C$19.50
▲(15.38% Upside)
Action:Reiterated
Date:07/31/26
The score is primarily driven by solid cash generation (positive free cash flow) and a manageable—though rising—leverage profile, offset by materially weak bottom-line profitability (deeply negative net margin and ROE). Technically, the stock is trading above key moving averages, supporting the rating, while valuation is helped by a ~3.29% dividend but constrained by a negative P/E tied to current losses.
Positive Factors
Cash Generation
Robust operating and free cash flow provides internal funding for production, maintenance, debt service, and shareholder returns. The ability to generate cash despite accounting losses supports financial resilience, although commodity-linked volatility can reduce predictability.
Negative Factors
Persistent Net Losses
Deeply negative net income weakens earnings quality and limits the reliability of reported profitability, even while operations generate cash. Continued losses can constrain capital allocation, reduce retained equity, and make future results more sensitive to non-operating charges.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Robust operating and free cash flow provides internal funding for production, maintenance, debt service, and shareholder returns. The ability to generate cash despite accounting losses supports financial resilience, although commodity-linked volatility can reduce predictability.
Read all positive factors
Vermilion Energy (VET) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$2.81B
Dividend Yield2.9%
Average Volume (3M)957.33K
Price to Earnings (P/E)―
Beta (1Y)0.25
Revenue Growth-2.21%
EPS Growth-142.44%
CountryCA
Employees636
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)-2.96
Shares Outstanding152,948,360
10 Day Avg. Volume957,648
30 Day Avg. Volume957,325
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.79
Price to Sales (P/S)1.00
P/FCF Ratio5.38
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$19.40Price Target Upside14.79% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)0.6
Revenue Forecast (FY)C$2.05B
Vermilion Energy Business Overview & Revenue Model
Company Description
Vermilion Energy Inc., engages in petroleum and natural gas, focuses on the acquisition, exploration, development, and optimization of producing properties in North America, Europe, and Australia. Its properties are located in the West Pembina reg...
How the Company Makes Money
Vermilion primarily makes money by producing hydrocarbons (crude oil, natural gas, and natural gas liquids) and selling those volumes into commodity markets. Revenue is recognized based on delivered volumes and realized prices, which are driven by...
Vermilion Energy Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive tone driven by production outperformance, strong cash flow generation, meaningful debt reduction, substantial unit cost improvements and improved capital efficiency. Strategic actions (German acquisitions and acreage additions, asset sales to reduce debt, and inventory of liquids-rich drilling) further support the outlook. Near-term headwinds included cyclone-related downtime in Australia, realized hedge losses of $15 million and exposure to weak AECO pricing, but these were presented as manageable and in many cases temporary or timing-related. Overall, the highlights outweigh the lowlights and management signaled confidence in delivering improved free cash flow and continued deleveraging.Positive Updates
Production Beat and Strong Volumes
Total production averaged 125,600 BOE/d in Q1 2026, exceeding the upper end of guidance. Canadian production averaged 99,700 BOE/d (a 10% increase sequentially) and international production averaged 25,900 BOE/d. Liquids weighting was ~28% in Q1 and is expected to rise to ~31% in Q2.
Negative Updates
Cyclone-Related Downtime in Australia
Two consecutive cyclone events temporarily shut-in Australian operations, reducing international production in the quarter and requiring repairs and recovery efforts (though production resumed after the quarter).
Read all updates
Q1-2026 Updates
Positive
Negative
Production Beat and Strong Volumes
Total production averaged 125,600 BOE/d in Q1 2026, exceeding the upper end of guidance. Canadian production averaged 99,700 BOE/d (a 10% increase sequentially) and international production averaged 25,900 BOE/d. Liquids weighting was ~28% in Q1 and is expected to rise to ~31% in Q2.
Read all positive updates
Company Guidance
Guidance highlights included Q2 2026 production of 123,000–125,000 BOE/d (Q1 was 125,600 BOE/d, Canada 99,700 BOE/d, International 25,900 BOE/d), with liquids weighting rising from ~28% in Q1 to ~31% in Q2; Vermilion said it is trending to the upper end of full‑year guidance without increasing the capital budget and reiterated a $1.0B net‑debt target (net debt $1.29B as of Mar 31, down $50M this quarter and $770M YoY). Financial guidance/metrics included $232M of Q1 funds from operations, $135M of E&D capex, $98M of free cash flow, a realized hedge loss of $15M in Q1, and management’s update that 2026 excess free cash flow (EFCF) is now expected to be roughly double the original 2026 budget projection. Operational and cost guidance noted continued Montney per‑well cost improvement to $8.2M (down $300k), ongoing 3‑rig Deep Basin activity (Q1: 10 wells drilled, 14 completed, 18 brought on), and a bullish European gas price outlook (~$16/MMBtu realized in Q1 and ~ $20/MMBtu expected on average over the next four quarters, with Q2 > $20/MMBtu).Vermilion Energy Financial Statement Overview
Summary
Income Statement
46
Neutral
Balance Sheet
55
Neutral
Cash Flow
72
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.86B | 1.77B | 2.07B | 1.93B | 3.72B | 2.23B |
| Gross Profit | 566.52M | 291.13M | 1.12B | 359.39M | 2.59B | 1.32B |
| EBITDA | 1.08B | 551.32M | 835.80M | 519.55M | 2.55B | 2.07B |
| Net Income | -446.40M | -653.60M | -46.74M | -237.59M | 1.31B | 1.15B |
Balance Sheet | ||||||
| Total Assets | 5.49B | 5.34B | 6.12B | 6.24B | 6.99B | 5.91B |
| Cash, Cash Equivalents and Short-Term Investments | 81.77M | 19.09M | 131.73M | 141.46M | 13.84M | 6.03M |
| Total Debt | 1.36B | 1.30B | 1.02B | 947.02M | 1.15B | 1.73B |
| Total Liabilities | 3.33B | 3.12B | 3.30B | 3.20B | 3.59B | 3.84B |
| Stockholders Equity | 2.16B | 2.22B | 2.81B | 3.03B | 3.40B | 2.07B |
Cash Flow | ||||||
| Free Cash Flow | 338.75M | 326.41M | 332.04M | 292.06M | 1.26B | 459.66M |
| Operating Cash Flow | 920.96M | 943.66M | 967.75M | 1.02B | 1.81B | 834.45M |
| Investing Cash Flow | -86.30M | -1.24B | -634.87M | -576.43M | -1.06B | -469.70M |
| Financing Cash Flow | -822.46M | 180.90M | -344.08M | -320.34M | -748.37M | -363.45M |
Vermilion Energy Technical Analysis
Positive
16.90
Price Trends
15.88
Positive
15.88
Positive
14.98
Positive
Market Momentum
0.69
Positive
64.66
Neutral
61.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:VET, the sentiment is Positive. The current price of 16.9 is below the 20-day moving average (MA) of 17.71, above the 50-day MA of 15.88, and above the 200-day MA of 14.98, indicating a bullish trend. The MACD of 0.69 indicates Positive momentum. The RSI at 64.66 is Neutral, neither overbought nor oversold. The STOCH value of 61.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:VET.
Vermilion Energy Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | C$3.21B | 17.76 | 24.24% | 3.25% | 12.71% | 0.77% | |
74 Outperform | C$2.78B | 3.55 | 27.68% | 5.33% | 13.63% | 361.28% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
62 Neutral | C$2.81B | -6.24 | -19.54% | 2.90% | -2.21% | -142.44% | |
62 Neutral | C$1.73B | 18.57 | 4.22% | 1.88% | 10.48% | 23.40% | |
62 Neutral | C$2.11B | 34.62 | 6.96% | 5.95% | 17.51% | -35.86% | |
60 Neutral | C$2.17B | 38.39 | 4.95% | ― | 30.30% | -24.69% |
* Energy Sector Average
TSE:VET
Vermilion Energy
18.47
8.16
79.16%
TSE:BIR
Birchcliff Energy
6.39
0.50
8.43%
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Headwater Exploration
13.85
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95.13%
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10.81
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54.43%
TSE:PXT
Parex Resources
28.87
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62.98%
TSE:CJ
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12.11
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69.09%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.