Assessing Athabasca Oil (TSX:ATH) Valuation After Its New 2026 Production Guidance Update

Athabasca Oil (TSX:ATH) just laid out its 2026 production roadmap, and it matters because this is the lens the market will use to gauge future cash flow and operational execution.

See our latest analysis for Athabasca Oil.

The stock has cooled off in the last month, with a 30 day share price return of negative 7.9 percent and a softer 7 day patch. However, that sits against a strong 24.5 percent year to date share price gain and an impressive 41.1 percent one year total shareholder return, which suggests longer term momentum is still very much intact as investors price in Athabasca’s growth and execution story.

If Athabasca’s trajectory has you rethinking where the next big move could be, this is a good moment to broaden your search and explore fast growing stocks with high insider ownership.

But with guidance now on the table, a modest pullback, and shares still trading at a discount to analyst targets, is Athabasca Oil quietly undervalued at this point, or already reflecting the next leg of its growth story?

Price-to-Earnings of 7.2x: Is it justified?

Athabasca Oil trades on a modest 7.2 times earnings, which looks inexpensive given the last close of CA$6.87 and its recent share price strength.

The price to earnings ratio compares what investors pay today for each dollar of current earnings, a core yardstick for profitable oil and gas producers. For a business that has just delivered 100.4 percent earnings growth and now sits solidly profitable, such a low multiple suggests the market is not fully crediting recent performance.

Against peers, the gap is stark, with Athabasca valued at 7.2 times earnings versus a Canadian oil and gas industry average of 14.2 times and a peer group near 25.4 times. Compared with an estimated fair price to earnings ratio of 8.2 times that our framework points to as a more balanced level, there appears to be room for the multiple to move higher if execution and cash generation stay on track.

Explore the SWS fair ratio for Athabasca Oil

Result: Price-to-Earnings of 7.2x (UNDERVALUED)

However, sustained revenue and net income declines, along with any stumble on its 2026 roadmap, could quickly challenge the current undervaluation thesis.

Find out about the key risks to this Athabasca Oil narrative.

Another View on Value

Our DCF model paints a far more aggressive picture, suggesting Athabasca Oil trades about 85 percent below its fair value at roughly CA$6.87 versus an estimated CA$46.46. That implies significant potential upside, but also raises a harder question: are the cash flow assumptions too optimistic for a cyclical producer?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Athabasca Oil for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 913 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Athabasca Oil Narrative

If you see the story differently or want to stress test your own assumptions using the same data, you can build a complete view in just a few minutes, Do it your way.

A great starting point for your Athabasca Oil research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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