Dorchester Minerals LP – Value Analysis (NASDAQ:DMLP) : February 1, 2017

Capitalcube gives Dorchester Minerals LP a score of 39.

Our analysis is based on comparing Dorchester Minerals LP with the following peers – North European Oil Royalty Trust, Marine Petroleum Trust, Enduro Royalty Trust, Panhandle Oil and Gas Inc. Class A, Permian Basin Royalty Trust, San Juan Basin Royalty Trust, Mesa Royalty Trust and Sabine Royalty Trust (NRT-US, MARPS-US, NDRO-US, PHX-US, PBT-US, SJT-US, MTR-US and SBR-US).

Investment Outlook

Dorchester Minerals LP has a fundamental score of 39 and has a relative valuation of NEUTRAL.

Fundamental Score

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Company Overview

  • Compared to peers, relative underperformance last month is down from a median performance last year.
  • Dorchester Minerals, L.P. trades at a lower Price/Book multiple (7.82) than its peer median (12.18).
  • The market expects faster earnings growth from DMLP-US than from its peers and also a turnaround in its current ROE.
  • DMLP-US‘s relatively low net margins and poor asset turns suggest a problematic operating strategy.
  • Changes in the company’s annual revenue and earnings are around the median among its peers.
  • DMLP-US‘s return on assets currently and over the past five years has trailed the peer median and suggests the company might be operationally challenged relative to its peers.
  • While DMLP-US‘s revenues growth has been around the peer median in recent years, the market seems to see faster growth ahead and gives its shares a higher than peer median P/E ratio.
  • The company’s relatively low level of capital investment and below peer median returns on capital suggest that the company is in maintenance mode.
  • DMLP-US currently does not have any debt.

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Leverage & Liquidity

DMLP-US currently does not have any debt.

  • We consider the company to have a Quick & Able profile as it currently does not have any debt. In comparison, the median level of debt as percent of enterprise value for its peer group is currently 0%.
  • Of the 8 chosen peers for the company, only 1 of the stocks have an outstanding debt balance (including PHX-US). Companies with no debt include NRT-US, MARPS-US, NDRO-US, PBT-US, SJT-US, MTR-US and SBR-US.

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Key Liquidity Items

Company Debt/Enterprise Value (%) Current Ratio Interest Coverage (x) Cash Flow To Total Debt (%)
North European Oil Royalty Trust 0 N/A No interest exp 999
Marine Petroleum Trust 0 N/A No interest exp N/A
Enduro Royalty Trust 0 N/A No interest exp N/A
Panhandle Oil and Gas Inc. Class A 13.28 1.47 -5.25 13.18
Permian Basin Royalty Trust 0 N/A 0 N/A
San Juan Basin Royalty Trust 0 N/A No interest exp N/A
Mesa Royalty Trust 0 N/A No interest exp N/A
Sabine Royalty Trust 0 N/A No interest exp N/A
Dorchester Minerals, L.P. 0 12.1 No interest exp 999
Peer Median 0 6.78 No interest exp 999
Best In Class 13.28 12.1 No interest exp 999

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Company Profile

Dorchester Minerals LP owns producing and non producing crude oil and natural gas mineral, royalty, overriding royalty and leasehold interests. The company was founded in December 2001 and is headquartered in Dallas, TX.

Disclaimer

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