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As part of an ongoing series, each week we spotlight a stock from our stock screeners that might be a deeply undervalued gem hiding in plain sight. This week’s spotlight is: GeoPark Limited (GPRK).

GeoPark is a Latin America-focused independent oil and gas exploration and production company. With assets across Colombia, Chile, Brazil, and Ecuador, the company has built a strong foothold in energy-rich basins. Despite a volatile operating environment, GeoPark Limited continues to generate consistent free cash flow while maintaining a disciplined capital return program.

What is IV/P (Intrinsic Value to Price)?

The IV/P metric tells you whether a stock offers more intrinsic value than the price you’re paying for it.

The Calculation

It blends earnings power, reinvestment efficiency, and capital return policy to estimate intrinsic value — a conservative valuation of what the business is worth.

The Interpretation

• If IV/P is more than 1, the stock may be undervalued
• If IV/P is less than 1, the stock may be overvalued
• The further above 1, the more value you may be getting per dollar invested

IV/P for GeoPark Limited: 2.00

GeoPark’s IV/P of 2.00 suggests its intrinsic value is estimated to be 100% higher than its recent market price — indicating a potentially wide margin of safety for investors willing to back small-cap energy producers.

Supporting Metrics

Provided below are some metrics that may be supporting the stock.

Free Cash Flow Yield: ~26%+

GeoPark has produced strong free cash flow relative to its ~$317 million market cap. High FCF yield signals the business is self-funding growth while providing room for dividends and buybacks.

Acquirer’s Multiple: 3.41

With an enterprise value of roughly ~$703 million against ~$206 million in operating earnings, the Acquirer’s Multiple comes in at 3.41 — placing GeoPark Limited firmly in “deep value” territory.

Revenue & Profitability

• Revenue (TTM): ~$560 million
• Operating Margin: ~32%
• Net Margin: ~8%
• Return on Equity (TTM): ~23%
• Trailing P/E: ~8.01

These metrics highlight a highly profitable operator in the oil & gas space, trading at a fraction of broader market multiples.

Capital Returns

• Dividend Yield (TTM): ~9.5%
• Buyback Yield: Ongoing (management has historically used excess cash for share repurchases)

GeoPark combines a healthy dividend policy with a history of buybacks, providing dual avenues of shareholder return.

Why Might GeoPark Limited Be Undervalued?

Discussed below are some potential reasons for the stock to be deemed as undervalued.

1. Small-Cap Neglect

With a sub-$400 million market cap, GeoPark Limited sits below the radar of most institutional investors, despite generating substantial cash flows.

2. High Free Cash Flow Generation

At recent oil prices, the company’s FCF yield rivals the best in the sector, giving it a strong buffer against commodity volatility.

3. Attractive Capital Returns

A near 9.5% dividend with a history of buybacks may make the total shareholder yield extremely compelling.

4. Deep Value Valuation

An Acquirer’s Multiple of 3.41 and IV/P of 2.00 suggest the market is likely pricing in a highly pessimistic scenario.

Conclusion

With an IV/P of 2.00, an Acquirer’s Multiple of just 3.41, a dividend yield of 9.5%, and strong free cash flow relative to its size, GeoPark offers an unusually compelling value opportunity in the energy sector. For investors comfortable with small-cap risk and commodity cyclicality, GeoPark Limited may represent a rare blend of deep value and strong capital return policy — making it a candidate worthy of deeper research.

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