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Baytex Energy (TSE:BTE)
TSX:BTE
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Baytex Energy
(TSX:BTE)
63Neutral
Positive Factors
Financial Performance
Q4 results were ahead of expectations, which is likely to please investors.
Operational Advancement
The first pad from Baytex's Duvernay program showed some of the highest rates the company has drilled in the play, which is a positive indicator of performance.
Operational Performance
Baytex continues to shine in the Clearwater play, which is one of the top areas for energy production in Canada.
Negative Factors
Financial Strategy
Due to high leverage in a highly volatile environment, the target price for Baytex is being reduced.
Market Volatility
The target price is being lowered to reflect volatility and lower crude price assumptions, along with slightly higher cash costs.
Production Levels
A reduction in non-operated Eagle Ford volumes is expected due to reduced activity.
Baytex Energy (BTE) vs. S&P 500 (SPY)
Market Cap
$1.75B
Dividend Yield4.03%
Average Volume (3M)6.16M
Price to Earnings (P/E)7.7
Beta (1Y)1.73
Revenue Growth22.71%
EPS GrowthN/A
CountryCA
Employees370
SectorEnergy
Sector Strength46
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.29
Shares Outstanding773,589,970
10 Day Avg. Volume8,043,235
30 Day Avg. Volume6,155,278
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.65
Price to Cash Flow (P/CF)1.30
P/FCF Ratio6.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$4.46Price Target Upside97.26% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Baytex Energy Business Overview & Revenue Model
Company DescriptionBaytex Energy Corp., an energy company, engages in the acquisition, development, and production of crude oil and natural gas in the Western Canadian Sedimentary Basin and in the Eagle Ford, the United States. The company offers light oil and condensate, heavy oil, natural gas liquids, and natural gas. It holds interest in the Eagle Ford property in Texas; Viking and Lloydminster properties in Alberta and Saskatchewan; and Peace River and Duvernay properties in Alberta. Baytex Energy Corp. was founded in 1993 and is headquartered in Calgary, Canada.
How the Company Makes MoneyBaytex Energy generates revenue primarily through the exploration, extraction, and sale of crude oil and natural gas. The company's key revenue streams include the sale of heavy oil, light oil, and natural gas liquids, as well as shale gas from its operations in Canada and the United States. Baytex optimizes its earnings by leveraging advanced extraction technologies and maintaining strategic partnerships for joint ventures and infrastructure access. Additionally, the company actively manages its commodity price exposure through hedging strategies to stabilize cash flows and ensure profitability despite market volatility.
Baytex Energy Financial Statement Overview
Summary
Baytex Energy has shown strong financial performance with significant revenue growth and profitability improvements. The balance sheet indicates moderate leverage and a solid equity base, while cash flow statements highlight robust cash generation capabilities. However, conversion of net income to free cash flow could be improved.Income Statement
Baytex Energy demonstrated significant revenue growth of 55.18% from the prior year. The company achieved a strong gross profit margin of 24.36% and a positive net profit margin of 5.62%, a turnaround from the previous year's net loss. EBITDA margin is quite robust at 46.69%, indicating healthy operational efficiency. However, the lack of EBIT data precludes a full assessment of operating profitability.78
Positive
Balance Sheet
The company's debt-to-equity ratio stands at 0.55, indicating moderate leverage. The return on equity is 5.67%, which shows a decent return on shareholder investment. Equity ratio of 53.76% suggests that more than half of the company's assets are financed by equity, which is a positive indicator of financial stability.70
Positive
Cash Flow
The company's free cash flow growth rate is impressive at 147.80%, supported by strong operating cash flow. The operating cash flow to net income ratio of 8.06 indicates high cash generation relative to reported net income. However, the free cash flow to net income ratio of 2.51 shows a lower conversion rate of net income into free cash flow.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.21B | 2.71B | 2.89B | 1.87B | 975.48M |
| Gross Profit | ||||
| 1.03B | 750.68M | 1.08B | 603.51M | -82.80M |
| EBIT | ||||
| 0.00 | 643.19M | 943.57M | 521.68M | -150.84M |
| EBITDA | ||||
| 1.97B | 723.50M | 1.58B | 2.27B | -1.99B |
| Net Income Common Stockholders | ||||
| 236.60M | -233.36M | 855.61M | 1.61B | -2.44B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 16.61M | 55.81M | 5.46M | -7.76M | -11.08M |
| Total Assets | ||||
| 7.76B | 7.46B | 5.10B | 4.83B | 3.41B |
| Total Debt | ||||
| 2.28B | 2.44B | 937.17M | 1.39B | 1.79B |
| Net Debt | ||||
| 2.27B | 2.38B | 931.70M | 1.40B | 1.80B |
| Total Liabilities | ||||
| 3.59B | 3.64B | 2.07B | 2.62B | 2.83B |
| Stockholders Equity | ||||
| 4.17B | 3.83B | 3.03B | 2.21B | 578.21M |
| Cash Flow | Free Cash Flow | |||
| 593.85M | 239.61M | 648.83M | 396.62M | 70.48M |
| Operating Cash Flow | ||||
| 1.91B | 1.30B | 1.17B | 712.38M | 353.10M |
| Investing Cash Flow | ||||
| -1.28B | -1.51B | -488.99M | -310.76M | -314.47M |
| Financing Cash Flow | ||||
| -668.17M | 266.25M | -678.42M | -401.62M | -44.20M |
Baytex Energy Technical Analysis
Negative
2.26
Price Trends
3.09
Negative
3.39
Negative
3.90
Negative
Market Momentum
-0.25
Positive
34.99
Neutral
25.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BTE, the sentiment is Negative. The current price of 2.26 is below the 20-day moving average (MA) of 2.84, below the 50-day MA of 3.09, and below the 200-day MA of 3.90, indicating a bearish trend. The MACD of -0.25 indicates Positive momentum. The RSI at 34.99 is Neutral, neither overbought nor oversold. The STOCH value of 25.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:BTE.
Baytex Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Performance Comparison
TSE:BTE
Baytex Energy
2.26
-2.67
-54.14%
CVE
Cenovus Energy
11.56
-8.30
-41.79%
MEGEF
MEG Energy
13.76
-9.03
-39.62%
SPGYF
Whitecap Resources
5.58
-1.48
-20.96%
TSE:TOU
Tourmaline Oil
60.74
-1.08
-1.75%
AETUF
ARC Resources
18.32
0.43
2.40%
Baytex Energy Earnings Call Summary
Earnings Call Date: Mar 4, 2025 | % Change Since: -23.83% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Positive
Baytex Energy demonstrated notable operational and financial achievements in 2024, with strong production growth, debt reduction, and shareholder returns. However, challenges such as tariffs, oil price volatility, and FX impacts on debt reporting pose potential risks.Highlights
Production and Reserves Growth
Baytex Energy achieved a 10% production per share growth and grew reserves per share across all categories in 2024. They replaced over 100% of production on both 1P and 2P bases.
Debt Reduction and Cash Flow
The company reduced net debt by 5% in Canadian dollars and 13% in U.S. dollars. They generated $656 million in free cash flow, with 70% generated in the second half of 2024.
Operational Efficiency Improvements
Baytex reported an 8% improvement in drilling and completion costs per completed lateral foot in the Eagle Ford, and they are working towards a further 7% improvement.
Shareholder Returns
In 2024, Baytex repurchased 48 million common shares, representing 6% of shares outstanding, and declared four quarterly dividends of 2.25 cents per share.
Strong Free Cash Flow Forecast for 2025
Baytex expects to generate approximately $400 million of free cash flow in 2025 at US $70 WTI, continuing their disciplined capital allocation.
Lowlights
Tariffs Impact on Canadian Operations
The implementation of new tariffs on Canadian energy imports to the U.S. could disproportionately impact Midwest refiners and affect Baytex's operations.
Oil Price Volatility Concerns
There is increasing bearishness in the oil market, with potential declines in oil prices affecting capital allocation decisions.
FX Impact on Debt Reporting
The strengthening U.S. dollar increases the Canadian dollar-denominated debt reporting, making it challenging to reflect true debt reduction.
Company Guidance
During the Baytex Energy Corp fourth quarter and year-end conference call, the company highlighted several key metrics reflecting their 2024 performance and guidance. Baytex reported a 10% growth in production per share and a 13% increase in 2P net asset value per share. They improved their cash cost structure by 5% on a barrel of oil equivalent (BOE) basis and achieved a reduction in net debt by 5% in Canadian dollar terms and 13% in U.S. dollar terms. Importantly, Baytex replaced over 100% of their production on both 1P and 2P bases, demonstrating strong reserve growth. The company generated free cash flow of $656 million, with over 70% of it produced in the second half of the year, and they repurchased 48 million common shares, representing 6% of shares outstanding. For 2025, Baytex anticipates generating approximately $400 million in free cash flow at a WTI price of US $70, maintaining exploration and development expenditures between $1.2 billion to $1.3 billion, and targeting a production level of 150,000 BOE per day at the midpoint of their guidance.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.