August 22, 2024
Top 10 Stock Baytex Energy Hold 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 August 22, 2024 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 26 (26% performer), Obermatt assesses an overall hold recommendation for Baytex Energy on August 22, 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 Hold
| 360 METRICS | August 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 80 |
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| GROWTH | ||||||||
| GROWTH | 18 |
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| SAFETY | ||||||||
| SAFETY | 17 |
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| SENTIMENT | ||||||||
| SENTIMENT | 49 |
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| 360° VIEW | ||||||||
| 360° VIEW | 26 |
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ANALYSIS: With an Obermatt 360° View of 26 (better than 26% compared with alternatives), overall professional sentiment and financial characteristics for the stock Baytex Energy are below the industry 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 80, 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 80% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 18, 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 17, meaning the company has a riskier financing structure than 83% 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 51% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 49. ...read more
RECOMMENDATION: With a consolidated 360° View of 26, Baytex Energy is worse than 74% 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 80. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 18), a riskier financing structure than the competition (Safety Rank of 17), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 49) is negative. 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 low 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 49 (better than 49% 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 of the indicators below and half above average for Baytex Energy. Analyst Opinions are at a rank of 58 (better than 58% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 84, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 84% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 16, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in Baytex Energy. There are also only so many institutional investors holding company stock with a Professional Investors rank of 45, which means that, currently, professional investors hold less stock in this company than in 55% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 49 (less encouraging than 51% compared with investment alternatives), Baytex Energy has a reputation among professional investors that is below that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: Baytex Energy Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 80 (better than 80% 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, with three out of four indicators above average for Baytex Energy. Price-to-Sales (P/S) is 88, which means that the stock price compared with what market professionals expect for future sales is lower than for 88% 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 67% 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 79. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 46% of all competitors have even lower dividend yields than Baytex Energy (a Dividend Yield Rank of 46). 54% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 80, is a 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 negative
ANALYSIS: With an Obermatt Growth Rank of 18 (better than 18% compared with alternatives), Baytex Energy shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for Baytex Energy. While Profit Growth has a good rank of 100, as professionals currently expect the company to grow its profits more than 100% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 6, which means that currently professionals expect the company to grow less than 94% of its competitors, while Capital Growth has a rank of 18 and Stock Returns have been below market median, with a rank of 35 (65% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 18, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more
Safety Strategy: Baytex Energy Debt Financing Safety risky
| SAFETY METRICS | August 22, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 22 |
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| REFINANCING | ||||||||
| REFINANCING | 33 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 23 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 17 |
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ANALYSIS: With an Obermatt Safety Rank of 17 (better than 17% compared with alternatives), the company Baytex Energy has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly 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 all three metrics below average for Baytex Energy. Liquidity is at 23, meaning that the company generates less profit to service its debt than 77% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 22, meaning the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. Finally, Refinancing is at a rank of 33 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 67% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 17 (worse than 83% compared with alternatives), Baytex Energy has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Baytex Energy Below-Average Financial Performance
| COMBINED PERFORMANCE | August 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 80 |
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| GROWTH | ||||||||
| GROWTH | 18 |
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| SAFETY | ||||||||
| SAFETY | 23 |
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| COMBINED | ||||||||
| COMBINED | 25 |
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ANALYSIS: With an Obermatt Combined Rank of 25 (worse than 75% compared with investment alternatives), Baytex Energy (Oil & Gas Production, Canada) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Baytex Energy are a good value (attractively priced) with a consolidated Value Rank of 80 (better than 80% of alternatives) but show below-average growth (Growth Rank of 18), and are riskily financed (Safety Rank of 17), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 25, is a hold recommendation based on Baytex Energy's financial characteristics. As the company Baytex Energy's key financial metrics exhibit good value (Obermatt Value Rank of 80) but low growth (Obermatt Growth Rank of 18) and risky financing practices (Obermatt Safety Rank of 17), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 80% 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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