Coterra Energy Inc. (CTRA) Stock Analysis
Coterra Energy Inc. (CTRA) Stock Analysis
Analysis from 10-Q filed 2025-11-04. Data as of Q4 2025.
Overall Grade: F (Concerning)
Coterra Energy Inc. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 8.4% | Near cost of capital |
| FCF Margin | 52.6% | Strong cash generation |
| Debt/Equity | 0.3x | Conservative leverage |
Investment Thesis: Healthy free cash flow margin of 52.6% provides financial flexibility for growth and shareholder returns.
Explore Coterra Energy Inc.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: Coterra Energy Inc. earns 8.4% ROIC, Top 50% in Energy
Coterra Energy Inc.'s trailing-twelve-month ROIC of 8.4% ranks Top 50% in Energy companies (sector median: 6.9%), driven by NOPAT margin of 24.3% combined with asset turnover of 0.3x. Source: 10-Q filed 2025-11-04.
| Metric | CTRA | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Adequate | Above sector median of 6.9% |
| Return on Equity (ROE) | 11.9% | Adequate | Moderate equity returns |
| Operating Margin | 32.1% | Excellent | Efficient operations |
Cash Flow: Coterra Energy Inc. generates $4.0B FCF at 52.6% margin, positive NaN/8 quarters
Coterra Energy Inc. generated $4.0B in free cash flow (TTM), a 52.6% FCF margin, a margin that ranks Top 25% in Energy. Operating cash flow exceeds net income by 2.3x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-04.
| Metric | CTRA | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 52.6% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $4.0B | Good | Positive cash generation |
| OCF/Net Income | 2.3x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: Coterra Energy Inc. at 0.3x leverage
Coterra Energy Inc.'s debt-to-equity ratio of 0.3x reflects conservative leverage. Total debt of $3.8B offset by $119.0M in cash. Source: 10-Q filed 2025-11-04.
| Metric | CTRA | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.3x | Excellent | Conservative capital structure |
| Net Cash Position | $-3.7B | Warning | Net debt position |
Valuation: Coterra Energy Inc. trades at 11.7x earnings
Coterra Energy Inc. trades at a P/E of 11.7x. Free cash flow yield of 20.1% offers attractive cash returns relative to price.
| Metric | CTRA | Rating | Context |
|---|---|---|---|
| P/E Ratio | 11.7x | Adequate | Reasonable valuation |
| EV/Sales | 3.1x | Good | Growth premium priced in |
| FCF Yield | 20.1% | Excellent | Attractive cash return |
| Dividend Yield | 3.3% | Adequate | Meaningful income |
Capital Allocation: Coterra Energy Inc. returns 4.0% shareholder yield
Coterra Energy Inc.'s total shareholder yield is 4.0% (dividends 3.3% + buybacks 0.7%). Source: 10-Q filed 2025-11-04.
| Metric | CTRA | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 4.0% | Good | Dividend + buyback yield combined |
| Buyback Yield | 0.7% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $821.0M | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Top 50% | 1.2x above |
| Free Cash Flow Margin | 52.6% | Top 25% | 6.0x above |
| Operating Margin | 32.1% | Top 25% | 3.5x above |
| Return on Equity (ROE) | 11.9% | Top 50% | 1.4x above |
| P/E Ratio | 11.7x | N/A | - |
Financial Scorecard
| Metric | CTRA | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Adequate | Top 50% of sector (median: 6.9%) |
| Free Cash Flow Margin | 52.6% | Excellent | Top 25% of sector (median: 8.8%) |
| Debt to Equity Ratio | 25.7% | Excellent | Conservative capital structure |
| P/E Ratio (Price-to-Earnings) | 11.7x | Adequate | Attractively valued |
| Free Cash Flow Yield | 20.1% | Excellent | High cash return |
Frequently Asked Questions
Q: What is Coterra Energy Inc.'s Return on Invested Capital (ROIC)?
Coterra Energy Inc. (CTRA) has a trailing twelve-month Return on Invested Capital (ROIC) of 8.4%. This compares above the sector median of 6.9%. An ROIC near 8-12% is approximately the cost of capital for most companies.
Q: What is Coterra Energy Inc.'s Free Cash Flow Margin?
Coterra Energy Inc. (CTRA) has a free cash flow margin of 52.6%, generating $4.0 billion in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is Coterra Energy Inc. stock overvalued or undervalued?
Coterra Energy Inc. (CTRA) trades at a P/E ratio of 11.7x, which is above the sector median of N/A. The EV/Sales multiple is 3.1x. Free cash flow yield is 20.1%, which represents an attractive cash return to investors.
Q: Does Coterra Energy Inc. pay a dividend?
Coterra Energy Inc. (CTRA) currently pays a dividend yield of 3.3%. Including share buybacks, the total shareholder yield is 4.0%. This yield is moderate, suggesting a balance between income and growth reinvestment.
Q: What is Coterra Energy Inc.'s revenue and earnings growth?
Coterra Energy Inc. (CTRA) grew revenue by 40.1% year-over-year. Earnings per share increased by 50.0% compared to the prior year. Double-digit revenue growth indicates strong demand and market share gains.
Q: Is Coterra Energy Inc. buying back stock?
Coterra Energy Inc. (CTRA) repurchased $141.0 million of stock over the trailing twelve months. This represents a buyback yield of 0.7%.
Q: How does Coterra Energy Inc. compare to competitors in Energy?
Compared to other companies in Energy, Coterra Energy Inc. (CTRA) shows: ROIC of 8.4% is above the sector median of 6.9% (Top 41%). FCF margin of 52.6% exceeds the sector median of 8.8% (Top 18% of sector). These rankings are based on MetricDuck's analysis of all Energy companies with available SEC filings.
Q: What warning signs should I watch for with Coterra Energy Inc.?
Coterra Energy Inc. (CTRA) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.
Data Source: Data sourced from 10-Q filed 2025-11-04. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.