VIST, Vista Energy S.A.B. de C.V.

Will it survive?

• Can it pay its interest? 10.0×
  Comfortable
  Operating income $625M ÷ interest expense $62M
  What this means

  Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.

• How heavy is the debt, net of cash? $637M · 1.0× operating profit
  Modest net debt
  Cash $764M + ST investments $632K − debt $1.4B
  What this means

  Netting $765M of cash and short-term investments against $1.4B of debt leaves $637M owed, about 1.0× a year's operating profit (2.2× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.

• How long is cash tied up? —
  Not enough data
  What this means

  The filing data didn't include the inputs for this check.

Is it a good business?

• Return on invested capital 15%
  High through the cycle
  6-yr median, range -8%–31%; 22% latest = NOPAT $505M ÷ invested capital $2.3B
  Industry peers: median 8%
  What this means

  The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 6 years (it ran 22% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.

• Owner-earnings margin 32%
  High through the cycle
  7-yr median margin, range -22%–38%; latest $521M = operating cash $959M − maintenance capex $438M
  Industry peers: median 28%
  What this means

  What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 32% of revenue this year, a 32% median across 7 years. It chose to put $615M more into growth, so free cash flow this year was ($94M) — the gap is investment, not weakness.

• Are earnings backed by cash? 2.01×
  Cash-backed
  Cash from ops $959M ÷ net income $478M
  What this means

  How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

• Where do the earnings go? 20%
  Reinvests most of it
  Dividends + buybacks $107M ÷ Owner Earnings $521M
  What this means

  Of $521M Owner Earnings, $107M (20%) went back to shareholders, $7M dividends, $100M buybacks. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.

• Investing or harvesting? 2.40×
  Expanding
  Capex $1.1B ÷ depreciation $438M
  What this means

  Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 0 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

• Adequate size Near
  Revenue ≥ $2B · $1.6B
  What this means

  Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.

• Strong liquidity Miss
  Current ratio ≥ 2× · 0.99×
  What this means

  Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.

• Conservative debt Miss
  Debt ≤ working capital · $1.4B vs ($5M) WC
  What this means

  Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.

• Earnings stability Miss
  A profit every year (7-yr record) · 2 loss years
  What this means

  Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.

• Dividend record Miss
  Uninterrupted dividends · 1 of 7 yrs
  What this means

  An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.

• Earnings growth —
  Earnings +33% over the record · —
  What this means

  Earnings were negative early in the record, a growth rate isn't meaningful.

• Moderate price —
  P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
  What this means

  Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $4.00/share (latest year $5.01), the averaged base the calculator's gate runs on, and book value is $17.00/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2017–2024

Whether the record’s returns held, and what the capital reinvested earned.

• Profitable years 5 of 7
  What this means

  Lost money in 2 year(s), look at what happened there before trusting the average.

• Return on capital ≥ 15% 4 of 6 yrs
  What this means

  A moat shows up as a high return on invested capital that holds year after year, not one good vintage.

• Operating margin −4% → 46% (3-yr avg ends)

  In the filing’s words The margin widened even though the filing names price competition — the gain came from volume or cost, not pricing power. Read where.

  What this means

  Through the cycle the operating margin widened — about −4% early to 46% lately, median 32% — pricing power intact or improving.

• Reinvestment, incremental ROIC 47%
  What this means

  Every extra dollar the business reinvested came back at a high incremental return — the lens GBM read for a moat that reinvests rather than merely harvests. The record and the 10-K are where you check whether the rate holds.

• Worst year 2020 · −25.6% op. margin
  What this means

  Operations went underwater in 2020, understand why before trusting the good years.

• Share count +0.1%/yr
  What this means

  Roughly flat share count, little dilution, little buyback.

• Dividend record paid
  What this means

  Paid a dividend in 1 of the years on record.