A Look At Santos (ASX:STO) Valuation As Profit Falls And Major Restructuring Plans Unfold

Simply Wall St.

Feb 23

Santos (ASX:STO) is back in focus after a sharp profit decline, a planned 10% workforce reduction, and a review of its Australian asset portfolio. The review is aimed at improving efficiency and ...

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The review is aimed at improving efficiency and ...</p>\n\n<a href=\"https://simplywall.st/stocks/au/energy/asx-sto/santos-shares/news/a-look-at-santos-asxsto-valuation-as-profit-falls-and-major\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>A Look At Santos (ASX:STO) Valuation As Profit Falls And Major Restructuring Plans Unfold</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nA Look At Santos (ASX:STO) Valuation As Profit Falls And Major Restructuring Plans Unfold\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-02-23 07:21 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/au/energy/asx-sto/santos-shares/news/a-look-at-santos-asxsto-valuation-as-profit-falls-and-major><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Santos (ASX:STO) is back in focus after a sharp profit decline, a planned 10% workforce reduction, and a review of its Australian asset portfolio. The review is aimed at improving efficiency and ...</p>\n\n<a href=\"https://simplywall.st/stocks/au/energy/asx-sto/santos-shares/news/a-look-at-santos-asxsto-valuation-as-profit-falls-and-major\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"STO.AU","symbol_name":"SANTOS LIMITED","start_time":0,"source_url":"https://simplywall.st/stocks/au/energy/asx-sto/santos-shares/news/a-look-at-santos-asxsto-valuation-as-profit-falls-and-major","article_id":"2613695272","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/1032000-choice1-main-header/1585186548616"],"rights":{"source":"simplywall_highlight","url":"https://simplywall.st/stocks/au/energy/asx-sto/santos-shares/news/a-look-at-santos-asxsto-valuation-as-profit-falls-and-major","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2613695272","pubTimestamp":1771802504,"columns":[],"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"Santos (ASX:STO) is back in focus after a sharp profit decline, a planned 10% workforce reduction, and a review of its Australian asset portfolio. The review is aimed at improving efficiency and shareholder returns.\nSee our latest analysis for Santos.\nSantos shares trade at A$6.94, with a 1-day share price return of a 0.86% decline, a 12.85% year to date share price return and a 9.29% 1 year total shareholder return. This suggests momentum has been gradually rebuilding as investors weigh cost...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"STO.AU":"SANTOS LIMITED","BK7142":"石油与天然气的勘探与生产","BK4088":"住宅建筑","CCS":"Century Communities","BK7507":"资源股"},"translate_title":"随着利润下降和重大重组计划的展开，桑托斯(ASX：STO)估值一览","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"STO.AU":1.5,"CCS":1},"content_text":"Santos (ASX:STO) is back in focus after a sharp profit decline, a planned 10% workforce reduction, and a review of its Australian asset portfolio. The review is aimed at improving efficiency and shareholder returns. See our latest analysis for Santos. Santos shares trade at A$6.94, with a 1-day share price return of a 0.86% decline, a 12.85% year to date share price return and a 9.29% 1 year total shareholder return. This suggests momentum has been gradually rebuilding as investors weigh cost cuts, unchanged 2026 production guidance and recent dividend and earnings announcements. If you are looking beyond Santos and want more ideas in the energy value chain, our screener of 85 nuclear energy infrastructure stocks can be a useful hunting ground for your next idea. With profits down, cost cuts underway and the share price still sitting below some valuation estimates, is Santos quietly offering value after a tough year, or has the market already priced in everything that lies ahead? AdvertisementMost Popular Narrative: 4.8% Undervalued With Santos last closing at A$6.94 against a narrative fair value of A$7.29, the key question is whether the company can execute on the growth, margin and cash flow story that underpins that gap.  Santos' rapid progress and delivery in carbon capture and storage (CCS), highlighted by the Moomba CCS project already storing over 1 million tonnes of CO2e, positions the company to leverage the global transition to lower carbon energy. This not only helps reduce emissions intensity and improve ESG credentials, but may also unlock new premium revenue streams and support higher net margins.  Read the complete narrative. Want to see what sits behind that valuation gap? The most followed narrative leans on a mix of revenue growth, firmer margins and a future earnings multiple that is not especially punchy by sector standards. Curious which cash flow profile and earnings path those assumptions point to over the next few years? The full narrative lays out the numbers in detail. Result: Fair Value of A$7.29 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, the story can change quickly if large project spending runs into delays or if regulatory or environmental setbacks start to pressure earnings and cash flows. Find out about the key risks to this Santos narrative. Another View: Earnings Multiple Sends a Different Signal Here is the tension. On one hand, Santos screens as good value when you compare its current P/E of 19.5x to an estimated fair ratio of 22.7x. On the other hand, that same 19.5x sits above peers at 12.3x and the wider Oceanic oil and gas group at 18.9x. In practice, that mix suggests some potential room for upside if the market leans toward the higher fair ratio. It also highlights clear risk if sentiment shifts back to the lower peer level instead. Which of those reference points you think the market will place more weight on is the key judgment here. See what the numbers say about this price — find out in our valuation breakdown. ASX:STO P/E Ratio as at Feb 2026Next Steps If the mixed messages on value and risk leave you unsure, do not wait for consensus. Instead, weigh the trade off yourself by checking the 2 key rewards and 1 important warning sign. Looking for more investment ideas? Do not stop with a single stock on your radar, use this momentum to line up a few more ideas so you are ready when opportunities appear.  Target potential mispricing by scanning our list of 8 high quality undervalued stocks that combine quality fundamentals with prices that may not fully reflect their strengths. Strengthen your income stream by reviewing 11 dividend fortresses, focused on higher yielding names where payouts are a core part of the return profile. Sleep easier by checking 7 resilient stocks with low risk scores, a set of companies filtered for lower risk scores so you can prioritise resilience alongside return potential.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0,"need_auth":false,"code":"91000000","status":"200"}}}