Analyst Flags Margin and Cash-Flow Risks at Three Energy Firms

StockStory analyst Anthony Lee highlighted Comstock Resources, Excelerate Energy and Granite Ridge Resources as energy stocks warranting caution in a Sept. 28 analysis. He cited slow growth, pressure on margins and limited cash generation.

StockStory said the energy industry had fallen 3.7% over the prior six months, while the S&P 500 gained 21.4%.

For Comstock, the analysis noted annual revenue growth of 3.7% over five years and a 9.1-percentage-point decline in EBITDA margin. It also cited the company’s cash-burning history as a concern about the business model’s long-term viability.

Excelerate Energy’s revenue base of $1.47 billion and gross margin of 29.9% were among StockStory’s concerns. The firm also had a 5.5% free cash flow margin over the prior five years, which the analysis said limited its ability to fund growth or return capital.

Granite Ridge Resources had revenue of $495.7 million, according to the article. StockStory pointed to a 20.1-percentage-point decline in its EBITDA margin and a 6.6% free cash flow margin over the prior five years as constraints on investment and shareholder returns.