June 1, 2023
Top 10 Stock Baytex Energy Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Baytex Energy – Top 10 Stock in SDG 15: Life on Land
Baytex Energy is listed as a top 10 stock on June 01, 2023 in the market index SDG 15 because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 53 (high 53% performer), Obermatt assesses an overall buy recommendation for Baytex Energy on June 01, 2023.
Snapshot: Obermatt Ranks
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° Assessment Baytex Energy Buy
| 360 METRICS | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 87 |
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| GROWTH | ||||||||
| GROWTH | 47 |
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| SAFETY | ||||||||
| SAFETY | 49 |
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| SENTIMENT | ||||||||
| SENTIMENT | 25 |
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| 360° VIEW | ||||||||
| 360° VIEW | 53 |
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ANALYSIS: With an Obermatt 360° View of 53 (better than 53% compared with alternatives), overall professional sentiment and engagement for the stock Baytex Energy are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Baytex Energy. Only the consolidated Value Rank has an attractive rank of 87, which means that the share price of Baytex Energy is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 87% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 47, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 49, meaning the company has a riskier financing structure than 51% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 75% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 25. ...read more
RECOMMENDATION: With a 360° View of 53, Baytex Energy is better than 53% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 87. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 47), a riskier financing structure (Safety Rank of 49), and negative market sentiment in the professional investor community (Sentiment Rank of 25). This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Baytex Energy is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Baytex Energy. Only invest if you have solid reasons to believe that the sluggish growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Baytex Energy only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 25 (better than 25% compared with alternatives), overall professional sentiment and engagement for the stock Baytex Energy is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Baytex Energy. Analyst Opinions are at a rank of 17 (worse than 83% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 34, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 12, which means that professional investors hold less stock in this company than in 88% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Baytex Energy is Market Pulse, with a rank of 66, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 66% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 25 (less encouraging than 75% compared with investment alternatives), Baytex Energy has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Baytex Energy Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 87 (better than 87% compared with alternatives) for 2023, Baytex Energy shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Baytex Energy. Price-to-Sales (P/S) is 92, which means that the stock price compared with what market professionals expect for future sales is lower than for 92% of comparable companies, indicating a good value regarding Baytex Energy's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 83% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 82. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 29% of all competitors have even lower dividend yields than Baytex Energy (an Dividend Yield Rank of 29). 71% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 87, is a strong buy recommendation based on Baytex Energy's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Baytex Energy Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 47 (better than 47% compared with alternatives), Baytex Energy shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Baytex Energy. Sales Growth has a rank of 96, which means that, currently, professionals expect the company to grow more than 96% of its competitors. Profit Growth with a rank of 80 is also above average. But Capital Growth has only a rank of 1, and Stock Returns with 15 are also below-average. Stock returns for Baytex Energy have recently been below 85% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 47, is a HOLD recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Baytex Energy. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Baytex Energy Debt Financing Safety below-average
| SAFETY METRICS | June 1, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 68 |
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| REFINANCING | ||||||||
| REFINANCING | 55 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 27 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 49 |
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ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Baytex Energy has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Baytex Energy is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Baytex Energy.Leverage is at 68, meaning the company has a below-average debt-to-equity ratio. It has less debt than 68% of its competitors.Refinancing is at a rank of 55, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 55% of its competitors. Liquidity is at 27, meaning that the company generates less profit to service its debt than 73% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 49 (worse than 51% compared with alternatives), Baytex Energy has a financing structure that is riskier than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Baytex Energy Above-Average Financial Performance
| COMBINED PERFORMANCE | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 87 |
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| GROWTH | ||||||||
| GROWTH | 47 |
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| SAFETY | ||||||||
| SAFETY | 27 |
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| COMBINED | ||||||||
| COMBINED | 71 |
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ANALYSIS: With an Obermatt Combined Rank of 71 (better than 71% compared with investment alternatives), Baytex Energy (Oil & Gas Production, Canada) shares have above-average financial characteristics compared with similar stocks. Shares of Baytex Energy are a good value (attractively priced) with a consolidated Obermatt Value Rank of 87 (better than 87% of alternatives) but show below-average growth (Growth Rank of 47), and are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 71, is a buy recommendation based on Baytex Energy's financial characteristics. As the company Baytex Energy's key financial metrics exhibit good value (Obermatt Value Rank of 87) but low growth (Obermatt Growth Rank of 47) and risky financing practices (Obermatt Safety Rank of 49), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 87% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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