Galp Energia S.G.P.S. : Portugal's Leading Oil and Gas Company : equity valuation

• Autor(a) principal: Ferreira, Cátia Maria Sousa
• Data de Publicação: 2012
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10400.14/11875
• topic: Domínio/Área Científica::Ciências Sociais::Economia e Gestão

Nowadays, companies are involved in a fiercely competitive environment and are more complex than they ever were. As a consequence, the need to more accurately access the value of an asset or an opportunity is essential, when the overall goal is to grow and to prosper. Furthermore, the recurrent instability in the financial markets has been unveiling irregular company‟s stock variations, which are no longer reliable indicators of firm´s performance evolution and ability to create future value. In this context, corporate valuation emerges as a leading-edge instrument for managers and investors that want to assess the real underlying value of their companies in order to make wiser business and investment decisions. Considering this, the main goal of the present dissertation is to value Galp Energia S.G.P.S, Portugal‟s leading oil and gas company, which is currently quoted in the Lisbon Stock Exchange Market and integrates the PSI-20 Index. After a review of the fundamental academic literature existing, the company‟s three main businesses segments as well as the debt tax shield were valued separately and the overall valuation was accomplished, considering the sum of the different parts. Subsequently, a sensitivity analysis was made and the methodology and results were compared with the ones used by two Investment Banks – Millennium IB and Caixa IB – in their recent equity researchs. The main conclusion is that each share of Galp Energia S.G.P.S. is currently being traded in the stock market at a discount to its intrinsic value. The future developments of its E&P projects – mainly in Brazil – and the evolution of macro variables such as the oil price, the international benchmarks for refining margins and the EUR/USD exchange rate will define the company‟s future valuation updates.