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Relative valuation derived from Energy sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 36.4GRADE D
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
-6.7%
Sector: 6.7%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, VERMILION ENERGY INC. (VET) receives a "Hold" rating with a composite score of 47.7/100, ranked #472 out of 4446 stocks. Key factor scores: Quality 36/100, Value 64/100, Momentum 67/100. This is quantitative analysis only — not investment advice.
VERMILION ENERGY INC. (VET) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does VERMILION ENERGY INC. Do?
Vermilion Energy Inc., together with its subsidiaries, engages in the acquisition, exploration, development, and production of petroleum and natural gas in North America, Europe, and Australia. It owns 81% working interest in 636,714 net acres of developed land and 85% working interest in 301,026 net acres of undeveloped land; 130,715 net acres of land in the Powder River basin in the United States; 96% working interest in 248,873 net acres of developed land and 86% working interest in 134,160 net acres of undeveloped land in the Aquitaine and Paris Basins in France; 53% working interest in 901,791 net acres of land in the Netherlands; 54,625 net developed acres and 920,723 net undeveloped acres in Germany; 975,375 net acres land in Croatia; 946,666 net acres land in Hungary; and 48,954 net acres land in Slovakia. As of December 31, 2021, the company had 401 net producing conventional natural gas wells and 2,132 net producing light and medium crude oil wells in Canada; 167.6 net producing light and medium crude oil wells in the United States; 297.0 net producing light and medium crude oil wells and 3 net producing conventional natural gas wells in France; and 47 net producing natural gas wells in the Netherlands. It also owns 20% interests in the offshore Corrib natural gas field located to the northwest coast of Ireland; and 100% working interest in the Wandoo offshore oil field and related production facilities that covers 59,553 acres located on Western Australia's northwest shelf. Vermilion Energy Inc. was founded in 1994 and is headquartered in Calgary, Canada. VERMILION ENERGY INC. (VET) is classified as a small-cap stock in the Energy sector, specifically within the Petroleum And Natural Gas industry. The company is led by CEO Anthony W. Marino and employs approximately 720 people, headquartered in Calgary, Alberta. With a market capitalization of $2.0B, VET is one of the notable companies in the Energy sector.
VERMILION ENERGY INC. (VET) Stock Rating — Hold (April 2026)
As of April 2026, VERMILION ENERGY INC. receives a Hold rating with a composite score of 47.7/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.VET ranks #472 out of 4,446 stocks in our coverage universe. Within the Energy sector, VERMILION ENERGY INC. ranks #60 of 128 stocks, placing it in the upper half of its Energy peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
VET Stock Price and 52-Week Range
VERMILION ENERGY INC. (VET) currently trades at $12.56. The stock gained $0.12 (1.0%) in the most recent trading session. The 52-week high for VET is $12.68, which means the stock is currently trading -0.9% from its annual peak. The 52-week low is $5.14, putting the stock 144.4% above its annual trough. Recent trading volume was 1.5M shares, reflecting moderate market activity.
Is VET Overvalued or Undervalued? — Valuation Analysis
VERMILION ENERGY INC. (VET) carries a value factor score of 64/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The price-to-book ratio stands at 1.02x, versus the sector average of 1.64x. The price-to-sales ratio is 0.38x, compared to 0.47x for the average Energy stock. On an enterprise value basis, VET trades at 1.23x EV/EBITDA, versus 3.50x for the sector.
Overall, VET's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
VERMILION ENERGY INC. Profitability — ROE, Margins, and Quality Score
VERMILION ENERGY INC. (VET) earns a quality factor score of 36/100, signaling below-average profitability metrics relative to the broader market. The return on equity (ROE) is -6.7%, compared to the Energy sector average of 6.7%, which is below typical expectations for high-quality companies. Return on assets (ROA) comes in at -3.1% versus the sector average of 3.7%.
On a margin basis, VERMILION ENERGY INC. reports gross margins of 59.9%, compared to 52.7% for the sector. The operating margin is 6.8% (sector: 10.7%). Net profit margin stands at -2.5%, versus 6.4% for the average Energy stock. Profitability is below benchmark levels, which may reflect industry headwinds, elevated reinvestment, or structural challenges.
VET Debt, Balance Sheet, and Financial Health
VERMILION ENERGY INC. has a debt-to-equity ratio of 36.0%, compared to the Energy sector average of 55.0%. The low leverage indicates a conservative balance sheet with significant financial flexibility. Total debt on the balance sheet is $707M. Cash and equivalents stand at $91M.
VET has a beta of 1.35, meaning it is more volatile than the broader market — a $10,000 investment in VET would be expected to move 34.9% more than the S&P 500 on any given day. The stability factor score for VERMILION ENERGY INC. is 39/100, suggesting elevated price swings that may be unsuitable for conservative portfolios.
VERMILION ENERGY INC. Revenue and Earnings History — Quarterly Trend
In TTM 2026, VERMILION ENERGY INC. reported revenue of $1.32B and earnings per share (EPS) of $-0.21. Net income for the quarter was $-32M. Gross margin was 59.9%. Operating income came in at $89M.
In FY 2024, VERMILION ENERGY INC. reported revenue of $1.32B and earnings per share (EPS) of $-0.21. Net income for the quarter was $-32M. Gross margin was 59.9%. Revenue grew -13.4% year-over-year compared to FY 2023. Operating income came in at $89M.
In FY 2023, VERMILION ENERGY INC. reported revenue of $1.52B and earnings per share (EPS) of $-1.10. Net income for the quarter was $-180M. Gross margin was 61.5%. Revenue grew -43.2% year-over-year compared to FY 2022. Operating income came in at $-213M.
In FY 2022, VERMILION ENERGY INC. reported revenue of $2.68B and earnings per share (EPS) of $8.03. Net income for the quarter was $970M. Gross margin was 73.5%. Revenue grew 67.7% year-over-year compared to FY 2021. Operating income came in at $1.41B.
Over the past 8 quarters, VERMILION ENERGY INC. has demonstrated a growth trajectory, with revenue expanding from $1.11B to $1.32B. Investors analyzing VET stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
VET Dividend Yield and Income Analysis
VERMILION ENERGY INC. (VET) does not currently pay a dividend. This is common among smaller companies in the Petroleum And Natural Gas industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Energy dividend stocks may want to explore other Energy stocks or use the stock screener to filter by dividend yield.
VET Momentum and Technical Analysis Profile
VERMILION ENERGY INC. (VET) has a momentum factor score of 67/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 56/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 11/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
VET vs Competitors — Energy Sector Ranking and Peer Comparison
Comparing VET against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full VET vs S&P 500 (SPY) comparison to assess how VERMILION ENERGY INC. stacks up against the broader market across all factor dimensions.
VET Next Earnings Date
No upcoming earnings date has been announced for VERMILION ENERGY INC. (VET) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy VET? — Investment Thesis Summary
VERMILION ENERGY INC. presents a balanced picture with arguments on both sides. The quality score of 36/100 flags below-average profitability. The value score of 64/100 suggests attractive pricing relative to fundamentals. Price momentum is positive at 67/100, suggesting the trend favors buyers. High volatility (stability score 39/100) increases portfolio risk.
In summary, VERMILION ENERGY INC. (VET) earns a Hold rating with a composite score of 47.7/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on VET stock.
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Institutional Research Dossier
VERMILION ENERGY INC. (VET) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Vermilion Energy Inc. is currently rated a Hold, a position supported by a mixed financial performance and a valuation that appears attractive on some metrics but concerning on others. The company's negative net income and free cash flow raise concerns about its ability to sustain operations and service its debt, despite a seemingly low EV/EBITDA ratio. While Vermilion operates in a sector with inherent cyclicality and geopolitical risks, its diversified geographical presence offers some mitigation, but its overall financial health necessitates a cautious approach.
The primary concern revolves around Vermilion's profitability and cash flow generation. While the company boasts a gross margin exceeding the sector average, its operating and net margins lag significantly, resulting in a negative net income. This, coupled with negative free cash flow, suggests operational inefficiencies or significant capital expenditures that are not immediately translating into profitability. Investors should closely monitor the company's ability to improve its bottom line and generate positive cash flow to justify a more optimistic outlook.
Business Strategy & Overview
Vermilion Energy Inc. operates as an international oil and gas producer with assets spanning North America, Europe, and Australia. The company's strategy centers on acquiring, exploring, developing, and producing petroleum and natural gas. Its diversified geographical footprint is a key element of its business model, aiming to reduce reliance on any single region and capitalize on varying commodity price environments and regulatory regimes. This diversification extends to its asset base, encompassing both conventional and unconventional resources, as well as a mix of oil and natural gas production.
Vermilion's European operations, particularly in France and the Netherlands, are significant contributors to its production profile. The company has focused on optimizing production from these assets through enhanced oil recovery techniques and cost management initiatives. In North America, Vermilion targets both organic growth through exploration and development and inorganic growth through strategic acquisitions. The Australian assets, primarily the Wandoo oil field, provide further geographical diversification and exposure to different market dynamics.
A critical aspect of Vermilion's strategy involves managing its production costs and capital expenditures. The company continuously seeks to improve operational efficiency and reduce its cost structure to enhance profitability, especially in periods of lower commodity prices. Capital allocation decisions are guided by a focus on projects with high rates of return and a disciplined approach to risk management. Vermilion also emphasizes environmental stewardship and sustainable development practices, reflecting the increasing importance of ESG considerations in the energy sector.
The company's success hinges on its ability to effectively manage its diverse asset portfolio, control costs, and navigate the complex regulatory and geopolitical landscape in which it operates. Furthermore, Vermilion's ability to adapt to changing energy market dynamics, including the growing emphasis on renewable energy sources and the transition to a lower-carbon economy, will be crucial for its long-term sustainability.
Execution Benchmarks audit
Gross Margin
Core pricing power
59.9%
Sector: 52.7%
+14% VS SCTR
Economic Moat Analysis
Vermilion Energy's economic moat is arguably narrow, stemming primarily from a combination of factors including geographical diversification and, to a lesser extent, intangible assets related to its operational expertise. The company's presence in multiple regions (North America, Europe, and Australia) provides a degree of insulation from region-specific economic downturns or regulatory changes. This diversification, however, does not inherently create a strong competitive advantage, as other energy companies also operate across multiple geographies.
The company's operational expertise, particularly in enhanced oil recovery techniques and cost management, can be considered a form of intangible asset. This expertise allows Vermilion to extract more value from its existing assets and operate more efficiently than some of its competitors. However, this advantage is not necessarily unique or difficult to replicate, limiting its moat strength. Furthermore, the energy sector is characterized by intense competition, with numerous players possessing similar technical capabilities.
Vermilion does not appear to benefit significantly from network effects or switching costs. Its products (oil and natural gas) are commodities, and customers typically have multiple suppliers to choose from. Similarly, the company does not possess significant cost advantages over its competitors. While it strives to optimize its cost structure, it faces the same input costs and market forces as other energy producers.
Efficient scale is not a major factor in Vermilion's business. The company's production volumes are relatively small compared to the major integrated oil and gas companies. While it may achieve economies of scale within its specific operations, it does not have a significant advantage in terms of overall scale compared to its larger peers. Therefore, while Vermilion possesses some elements of competitive advantage, these are not strong enough to create a wide economic moat. The narrow moat reflects the company's ability to generate returns that are slightly above its cost of capital, but its competitive position is vulnerable to changes in commodity prices, regulatory policies, and technological advancements.
Financial Health & Profitability
Vermilion Energy's financial health presents a mixed picture. While the company boasts a gross margin consistently above the sector average, its profitability metrics, particularly net income and free cash flow, are concerning. The company's revenue has fluctuated significantly over the past several years, reflecting the volatility of commodity prices. The revenue declined from $2.68B in FY2022 to $1.32B in FY2024. This volatility underscores the company's sensitivity to external market conditions.
The company's net income has been highly variable, ranging from a substantial profit of $970.34M in FY2022 to a loss of $-1.19B in FY2020 and $-32.46M in FY2024. This volatility is primarily driven by fluctuations in commodity prices and impairment charges. The company's operating margin has also been inconsistent, ranging from a high of 74.3% in FY2021 to a low of -166.5% in FY2020. The operating margin of 6.8% in FY2024 is significantly below the sector average of 10.6%.
Free cash flow has also been volatile, with a significant positive FCF of $4.95B in FY2022, driven by high commodity prices, but negative FCF in FY2023 and FY2024. The negative free cash flow in recent years raises concerns about the company's ability to fund its capital expenditures and debt obligations. The company's debt-to-equity ratio of 36.00 is lower than the sector average of 55.00, indicating a relatively conservative capital structure. However, the company's ability to service its debt depends on its ability to generate positive cash flow.
The company's cash balance of $91.48M is relatively low compared to its total debt of $707.25M. This suggests that the company may need to rely on external financing or asset sales to meet its debt obligations. Overall, Vermilion's financial health is characterized by volatility and uncertainty. While the company has demonstrated the ability to generate strong profits and cash flow in favorable market conditions, its recent performance raises concerns about its ability to sustain its operations in a less supportive environment. Investors should closely monitor the company's ability to improve its profitability and cash flow generation.
Valuation Assessment
Vermilion Energy's valuation presents a complex picture, with some metrics suggesting undervaluation while others raise concerns. The company's P/E ratio is not meaningful (N/A) due to negative earnings, making it difficult to assess its valuation relative to its earnings. However, its EV/EBITDA ratio of 1.3x is significantly below the sector average of 3.5x, suggesting that the company may be undervalued based on its enterprise value relative to its earnings before interest, taxes, depreciation, and amortization.
However, the low EV/EBITDA ratio should be interpreted with caution, as it may reflect concerns about the company's future growth prospects and financial health. The company's negative net income and free cash flow raise questions about its ability to sustain its EBITDA levels. Furthermore, the company's high debt levels may also contribute to a lower valuation multiple.
Compared to its historical valuation, Vermilion's current valuation appears to be below its historical averages. However, this may reflect the company's recent financial performance and the overall decline in commodity prices. The company's valuation is also influenced by the inherent cyclicality of the energy sector. During periods of high commodity prices, Vermilion's valuation tends to increase, while during periods of low commodity prices, its valuation tends to decrease.
Overall, Vermilion's valuation is difficult to assess due to its negative earnings and volatile financial performance. While its EV/EBITDA ratio suggests potential undervaluation, investors should carefully consider the company's financial health, growth prospects, and the cyclical nature of the energy sector before making an investment decision. A discounted cash flow analysis, incorporating conservative assumptions about future commodity prices and production volumes, may provide a more comprehensive assessment of the company's intrinsic value.
Risk & Uncertainty
Vermilion Energy faces several key risks that could significantly impact its financial performance and valuation. The most prominent risk is commodity price volatility. As an oil and gas producer, Vermilion's revenues and profitability are directly tied to the prices of crude oil and natural gas. Fluctuations in these prices, driven by global supply and demand dynamics, geopolitical events, and macroeconomic factors, can significantly impact the company's earnings and cash flow. A sustained decline in commodity prices could lead to reduced profitability, asset impairments, and difficulty in servicing its debt obligations.
Regulatory and political risks are also significant concerns for Vermilion. The company operates in multiple jurisdictions, each with its own set of environmental regulations, tax policies, and political risks. Changes in these regulations or policies could increase the company's operating costs, restrict its access to resources, or negatively impact its profitability. For example, stricter environmental regulations could require Vermilion to invest in costly emission reduction technologies or limit its ability to develop certain assets. Political instability in any of the regions where Vermilion operates could also disrupt its operations and impact its financial performance.
Another key risk is operational risk. Vermilion's operations involve complex and potentially hazardous activities, such as drilling, production, and transportation of oil and gas. Accidents, equipment failures, or natural disasters could disrupt its operations, damage its assets, and result in significant financial losses. The company also faces risks related to reservoir performance, production declines, and the need to invest in enhanced oil recovery techniques to maintain its production levels.
Finally, Vermilion faces competition from other oil and gas producers. The energy sector is highly competitive, with numerous players vying for market share. Vermilion competes with both large integrated oil companies and smaller independent producers. Increased competition could lead to lower prices, reduced market share, and decreased profitability. The company also faces competition from alternative energy sources, such as renewable energy, which could reduce demand for oil and gas in the long term.
Bulls Say / Bears Say
The Bull Case
BULL VIEWVermilion's diversified geographical asset base provides a hedge against regional economic downturns and regulatory changes, offering stability compared to peers focused on a single region.
BULL VIEWThe company's low EV/EBITDA ratio suggests it is undervalued relative to its peers, presenting a potential buying opportunity if commodity prices stabilize or increase.
BULL VIEWVermilion's focus on cost management and operational efficiency will allow it to generate strong cash flow when commodity prices rebound, leading to debt reduction and increased shareholder value.
The Bear Case
BEAR VIEWVermilion's negative net income and free cash flow raise serious concerns about its financial sustainability, particularly if commodity prices remain depressed.
BEAR VIEWThe company's high debt levels make it vulnerable to interest rate increases and economic downturns, potentially leading to financial distress.
BEAR VIEWVermilion's reliance on volatile commodity prices exposes it to significant earnings risk, making it difficult to predict future financial performance and justify a higher valuation.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score VET and 4,400+ other equities.
VERMILION ENERGY INC. exhibits a 75% valuation discount relative to institutional benchmarks. This represents a constructive entry window based on current multiples.
Return on Assets
Efficiency of asset utilization
-3.1%
Sector: 3.7%
Gross Margin
Pricing power and cost efficiency
59.9%
Sector: 52.7%
Operating Margin
Core business profitability
6.8%
Sector: 10.7%
Net Margin
Bottom-line profitability
-2.5%
Sector: 6.4%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
