Value
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.9 |
| P/S | 9.0 |
| EV/EBITDA | 9.6 |
| Fwd P/E | 9.4 |
| PEG | 5.8 |
| Analyst target | 4.0 |
- ▸Forward P/E: 9.1x
- ▸PEG: 1.30
- ▸Attractively valued
APA · Why this verdict
Why APA (APA) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictBUY WAIT
Overall score5.9/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
APA Corporation is a high-quality oil and gas producer with a wide moat, 128% cash conversion and a perfect four-quarter beat streak, but the price of $52.82 is already above the $44.10 analyst target and sits overbought at a 52-week high.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
APA earns a 27% return on equity with 20% margins, 128% free cash flow to net income and a wide economic moat. Quality breakdown | ROE stays above 20% and cash conversion stays above 100% over 12 months. | →Stable |
| CounterOil and gas earnings follow commodity prices, so high returns at a price peak can reverse quickly when prices fall. | ||
APA beat EPS estimates in all of the last 4 quarters with an average surprise of 20.3%, with the next report due 2026-11-04. Earnings | Another EPS beat at the November report. | ↑Improving |
| CounterThe latest beat was only 1.0%, showing the surprise is fading, and earnings in 3 days is a binary event. | ||
The price of $52.82 is 16.5% above the $44.10 analyst target, leaving negative upside against 15% downside. Targets | Analysts raise targets above $53 or the price pulls back toward the $51.28 entry level. | Tripped↑Improving |
| CounterEnergy analysts often lag commodity moves, but a reward-to-risk of -1.1 offers no cushion if oil prices fall. | ||
APA trades at a forward P/E of 9.8x and a PEG of 1.30, an attractively valued multiple for a company with 8/9 Piotroski strength. Valuation breakdown | Forward P/E stays below 12x while earnings hold. | ↑Improving |
| CounterCheap multiples on peak commodity earnings often reflect expected earnings decline, not a bargain. | ||
The stock is overbought (RSI 80) and only 0.3% below its 52-week high, on rising volume. Momentum breakdown | The price holds above the $48.20 stop while RSI cools below 70. | ↓Deteriorating |
| CounterRSI of 80 at a 52-week high often precedes a pullback, particularly into an earnings release. | ||
APA earns a 27% return on equity with 20% margins, 128% free cash flow to net income and a wide economic moat.
→StableQuality breakdown
- Expectation
- ROE stays above 20% and cash conversion stays above 100% over 12 months.
CounterOil and gas earnings follow commodity prices, so high returns at a price peak can reverse quickly when prices fall.
APA beat EPS estimates in all of the last 4 quarters with an average surprise of 20.3%, with the next report due 2026-11-04.
↑ImprovingEarnings
- Expectation
- Another EPS beat at the November report.
CounterThe latest beat was only 1.0%, showing the surprise is fading, and earnings in 3 days is a binary event.
The price of $52.82 is 16.5% above the $44.10 analyst target, leaving negative upside against 15% downside.
Tripped↑ImprovingTargets
- Expectation
- Analysts raise targets above $53 or the price pulls back toward the $51.28 entry level.
CounterEnergy analysts often lag commodity moves, but a reward-to-risk of -1.1 offers no cushion if oil prices fall.
APA trades at a forward P/E of 9.8x and a PEG of 1.30, an attractively valued multiple for a company with 8/9 Piotroski strength.
↑ImprovingValuation breakdown
- Expectation
- Forward P/E stays below 12x while earnings hold.
CounterCheap multiples on peak commodity earnings often reflect expected earnings decline, not a bargain.
The stock is overbought (RSI 80) and only 0.3% below its 52-week high, on rising volume.
↓DeterioratingMomentum breakdown
- Expectation
- The price holds above the $48.20 stop while RSI cools below 70.
CounterRSI of 80 at a 52-week high often precedes a pullback, particularly into an earnings release.
Per-dimension breakdown
Quality
8.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 8.9 |
| ROA | 7.7 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 9.8 |
| Current ratio | 3.8 |
| FCF quality | 9.3 |
| Moat | 7.6 |
| Rule of 40 | 5.5 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 27%
- ▸Strong margins: 20%
- ▸Excellent cash conversion: 128% FCF/NI
- ▸Wide economic moat
Growth
6.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.8 |
| EPS growth | 7.3 |
Momentum
2.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 0.9 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 5.3 |
| erm sentiment | 4.8 |
Insider
5.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.4 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.7 |
| quality rank | 6.9 |
| growth rank | 0.8 |
- ▸Superior ROE vs peers
Technical
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.9 |
| support resistance | 5.1 |
| 52w position | 8.1 |
| gap | 6.0 |
Risk (lower is worse)
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.6 |
| days to cover | 6.7 |
| volatility | 3.2 |
| put call | 0.0 |
| implied vol | 2.4 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 8.0 |
- ▸Elevated put/call: 2.37
- ▸High IV: 65%
- ▸Above max pain $25
Catalyst
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 8.5 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 1 day
- ▸Dividend aristocrat: 2.0% yield
How the verdict was assembled
Engine trigger
Earnings in 1 day. Wait until post-earnings.
Engine technical detail
verdict_path:
L4:PATH_D_BALANCED|V8:TARGET_REACHED|EARNINGS:BUY_DEFERRED|ENTRY_STICKY:WITHIN_BANDPassed (5)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:2.7<4.5
- ASYMMETRY:-0.8=NEGATIVE
- EARNINGS_PROXIMITY:1d<=7d
Warning (0)
none
Reward-to-Risk
-0.80
Upside
-8.1%
Downside
10.1%
Sizing output
STARTER
SetupRange Bound — RSI 53 mid-range, Bollinger mid-band
EdgeTemporary headwind — High quality (8.2) with weak momentum (2.7)
SuitabilityModerate — Balanced profile
Investment implication
The D-path balanced-high-score trigger fired: quality 8.2 and value 7.5 both cleared their gates at R:R of -0.80.
The strongest dimensions are Quality at 8.2, Catalyst at 7.7, and Value at 7.5; the weakest are Momentum at 2.7, Peer rank at 4.4, and Risk (lower is worse) at 4.9. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of -0.80 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Cash Generation
Trip ifFree cash flow to net income falls below 80%.
- P2Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P3Price Above Analyst TargetTripped
Trip ifPrice falls below the $48.20 stop level.
- P4Attractive Valuation
Trip ifForward P/E rises above 14x.
- P5Overbought Near 52 Week High
Trip ifRSI stays above 85 while the price rises more than 10% in 2 weeks.