Obsidian Energy Ltd. Common Shares (OBE)

FairStock Score: 49/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses that can endure cycles and produce cash. Obsidian Energy is a small Western Canadian oil and gas producer with 148 employees, formerly Penn West. In fiscal Q2 2026, it reported revenue of $201.5 million and net income of $42.0 million, a 20.84% margin, which is a strong quarterly result. But commodity producers rarely have a moat; they sell into markets they do not control. The trailing picture is less comforting. Using FairStock's calculations from the 2026-10-13 close of $11.77, the P/E is 39.23, ROE is 1.99%, ROCE is 2.19%, and trailing free cash flow is negative $181.7 million, a -21.4% FCF yield. That cash burn is a major yellow flag. The balance sheet has a D/E of 0.27, but the Altman Z-score of 0.43 suggests distress risk. Book value offers some support: P/B is 0.78, and the Graham Number is $11.90, leaving only a 1.09% margin of safety. EV/EBITDA of 4.85 looks inexpensive if earnings normalize, and PEG of 0.22 reflects large recent growth, though one good quarter is not a track record. Piotroski is 6/9, middling. FairStock's 49/100 score and a Lynch category of none—because only zero years of filed results are available when three are needed—leave me with limited confidence in durable earning power. At today's price, the market is not paying much for assets, but the business must convert revenue into consistent free cash flow before I would call it a sound value.

In plain English: Obsidian Energy is a small Canadian oil and gas producer. In its latest reported quarter, fiscal Q2 2026, it earned a profit on $201.5 million of revenue, but the wider numbers show it spent more cash than it generated and earns low returns. At the 2026-10-13 close of $11.77, the price looks roughly in line with its book value and not clearly cheap or expensive based on the figures provided.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer