Section1: Company Overview and Fundamental Insights

1.1 Company Overview:

Athabasca Oil Corp (TSX: ATH) is an energy company focused on the exploration, development, and production of light oil and liquids-rich natural gas. The company organizes its business under two operational segments, Light Oil and Thermal Oil. It generates maximum revenue from the Thermal Oil segment. Kalkine’s Penny Report covers the Investment Highlights, Key Financial Metrics, Risks, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stock.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders:

The top 10 shareholders together form ~17.11% of the total shareholding. Ninepoint Partners LP and Fidelity Management & Research Company LLC hold a maximum stake in the company at ~­­­8.22% and ~4.18%, respectively.

1.4 Key Metrics:

The company has reported rising bitumen production volume along sequentially improving margin profile in Q3 2023, which is a key positive. Moreover, it posted minimized term debt and improved liquidity ratios, demonstrating its strength and adaptability.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates: The below picture gives an overview of the company’s recent activity, where it announced the closure of non-core light oil asset sale.

2.2 Insights on Q3 2023 Financial Performance:

Section 3: Key Risks, Company Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

The stock has witnessed a downside of ~1.04% and ~3.31% over the last 1 week and 3 months respectively. Moreover, the stock is trading above the average of 52-week high price of CAD 4.40 and 52-week low price of CAD 2.01 providing an opportunity to ride the trend. Athabasca Oil Corp (TSX: ATH) was last covered on 27^th Nov 2023.

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is December 8, 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined:

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.