Northern Oil and Gas Inc. Common Stock (NOG)

FairStock Score: 33/100 — RISKY

Key Financials

Strengths

• Generates $6 million in annual free cash flow (0.2% yield on market cap)
• Attractive 6.8% dividend yield providing steady income returns

Concerns

• Trades significantly above Graham Number ($14) with negative 92% margin of safety—limited downside protection
• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Revenue declining at 17.9% year-over-year signals potential demand weakness or market share loss
• Altman Z-Score of 0.8 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Northern Oil and Gas Inc. Common Stock is a small-cap energy company valued at $2.8 billion. Revenue stands at $2.0 billion, though the company is currently unprofitable. From a quality standpoint, Northern shows distressed Altman Z-Score of 0.8 warrants caution and modest 2% ROE. On valuation, the stock is commanding a steep 69.0x multiple, with trades above its Graham Number with a negative 92% margin. Growth dynamics show revenue growing at -17.9% and profit growth of -198.7%. The 6.8% dividend yield adds an income component for patient holders. Our composite FairStock Score of 33/100 reflects below-average fundamentals overall. Without profitability, this remains speculative—suitable only for those with high risk tolerance and a long time horizon.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $6 million in annual free cash flow (0.2% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 69x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer