January 11, 2024
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 January 11, 2024 in the market index SDG 15 because of its high performance in at least one of the Obermatt investment strategies. While only half of the consolidated Obermatt Ranks exhibit above-average performance, the professional market sentiment is positive and it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 67 (high 67% performer), Obermatt assesses an overall buy recommendation for Baytex Energy on January 11, 2024.
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° View Baytex Energy Buy
| 360 METRICS | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 94 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 37 |
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| SENTIMENT | ||||||||
| SENTIMENT | 65 |
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| 360° VIEW | ||||||||
| 360° VIEW | 67 |
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ANALYSIS: With an Obermatt 360° View of 67 (better than 67% compared with alternatives), overall professional sentiment and financial characteristics for the stock Baytex Energy are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Baytex Energy. The consolidated Value Rank has an attractive rank of 94, which means that the share price of Baytex Energy is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 94% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 65, which means that professional investors are more optimistic about the stock than for 65% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 39, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 37, meaning the company has a riskier financing structure than 63 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 67, Baytex Energy is better positioned than 67% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 94) and positive market sentiment in the professional investor community (Sentiment Rank of 65), but growth expectations are below-average (Growth Rank of 39) and the financing structure is on the risky side(Safety Rank of 37). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (positive 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. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of Baytex Energy is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for Baytex Energy positive
ANALYSIS: With an Obermatt Sentiment Rank of 65 (better than 65% compared with alternatives), overall professional sentiment and engagement for the stock Baytex Energy is above average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for Baytex Energy. Analyst Opinions are at a rank of 66 (better than 66% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 54, which means that currently, professional investors hold more stock in this company than in 54% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 87 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 87% of competitors). But Analyst Opinions Change has a below-average rank of 7, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in Baytex Energy. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 65 (more positive than 65% compared with investment alternatives), Baytex Energy has a reputation among professional investors that is above-average compared with that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more
Value Strategy: Baytex Energy Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 94 (better than 94% compared with alternatives) for 2024, Baytex Energy shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Baytex Energy. Price-to-Sales is 89 which means that the stock price compared with what market professionals expect for future sales is lower than for 89% of comparable companies, indicating a good value for Baytex Energy's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 91% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 83. Compared with other companies in the same industry, dividend yields of Baytex Energy are expected to be higher than for 50% of all competitors (a Dividend Yield rank of 50). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 94, is a buy recommendation based on Baytex Energy's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Baytex Energy based on its detailed value metrics.
Growth Strategy: Baytex Energy Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% 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 63, which means that, currently, professionals expect the company to grow more than 63% of its competitors. Profit Growth with a rank of 68 is also above average. But Capital Growth has only a rank of 42, and Stock Returns with 11 are also below-average. Stock returns for Baytex Energy have recently been below 89% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, 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 | January 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 68 |
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| REFINANCING | ||||||||
| REFINANCING | 27 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 27 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 37 |
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ANALYSIS: With an Obermatt Safety Rank of 37 (better than 37% 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, with just one indicator above average for Baytex Energy and the other two below average. Leverage is at a rank of 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 27, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 73% of its competitors. Liquidity is at a rank of 27, meaning that the company generates less profit to service its debt than 73% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 37 (worse than 63% compared with alternatives), Baytex Energy has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Baytex Energy are on the safer side. ...read more
Combined financial peformance: Baytex Energy Above-Average Financial Performance
| COMBINED PERFORMANCE | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 94 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 27 |
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| COMBINED | ||||||||
| COMBINED | 67 |
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ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% 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 Value Rank of 94 (better than 94% of alternatives) but show below-average growth (Growth Rank of 39), and are riskily financed (Safety Rank of 37), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 67, 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 94) but low growth (Obermatt Growth Rank of 39) and risky financing practices (Obermatt Safety Rank of 37), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 94% 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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