Transportadora de Gas del Sur SA (TGS, Financial) is a leading player in the Oil & Gas industry, with a market capitalization of $1.8 billion. As of August 8, 2023, the company's stock price stands at $11.95, marking a gain of 3.91% for the day. However, over the past four weeks, the stock has seen a loss of 14.34%. Despite this recent downturn, TGS boasts a robust GF Score of 82 out of 100, indicating good outperformance potential. The GF Score is a comprehensive stock performance ranking system developed by GuruFocus, which evaluates a company's financial strength, profitability, growth, GF value, and momentum.
Financial Strength Analysis
TGS's Financial Strength rank stands at 7 out of 10. This score is derived from several key factors, including the company's debt burden, debt to revenue ratio, and Altman Z-Score. TGS's interest coverage ratio is 6.79, indicating a manageable debt burden. The company's debt to revenue ratio is 0.72, suggesting a healthy balance between debt and revenue. Furthermore, the Altman Z-Score of 4.40 indicates a low risk of bankruptcy.
Profitability Rank Analysis
The company's Profitability Rank is a perfect 10 out of 10. This score is based on factors such as operating margin, Piotroski F-Score, trend of the operating margin, consistency of profitability, and Predictability Rank. TGS's operating margin is 29.58%, and its Piotroski F-Score is 5, indicating a stable financial situation. The company has also demonstrated consistent profitability over the past 10 years.
Growth Rank Analysis
TGS's Growth Rank is also a perfect 10 out of 10, reflecting strong revenue and profitability growth over the past few years. The company's 5-year revenue growth rate is 40.40%, and its 3-year revenue growth rate is 18.80%. Additionally, TGS's 5-year EBITDA growth rate is 42.80%, indicating a robust growth trajectory.
GF Value Rank Analysis
The company's GF Value Rank is 1 out of 10, suggesting that the stock is currently overvalued. This rank is determined by the price-to-GF-Value ratio, a proprietary metric calculated based on historical multiples and an adjustment factor based on a company's past returns and growth.
Momentum Rank Analysis
TGS's Momentum Rank is 3 out of 10, indicating a relatively low momentum in the stock price. This rank is determined using the standardized momentum ratio and other momentum indicators.
Competitor Analysis
When compared to its main competitors, YPF SA, Saudi Arabian Oil Co, and Exxon Mobil Corp, TGS holds a competitive position with a GF Score of 82. YPF SA has a GF Score of 64, Saudi Arabian Oil Co has a GF Score of 77, and Exxon Mobil Corp has a GF Score of 85. More details about these competitors can be found here.
Conclusion
In conclusion, Transportadora de Gas del Sur SA (TGS, Financial) presents a compelling investment opportunity with good outperformance potential, as indicated by its GF Score of 82. The company's strong financial strength, high profitability, and robust growth make it a strong contender in the Oil & Gas industry. However, investors should be mindful of the stock's current overvaluation and relatively low momentum. As always, potential investors are advised to conduct their own comprehensive analysis before making investment decisions.
