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Strategies & Market Trends : Dino's Bar & Grill -- Ignore unavailable to you. Want to Upgrade?

To: Goose94 who wrote (51450)	11/16/2018 8:15:29 PM
From: Goose94	Read Replies (1) \| Respond to of 203362

Baytex Energy (BTE-T) (revisited) top pick from Eric Nuttall on BNN.ca Market Call Friday Nov 16th @ 1200ET Baytex Energy is our highest conviction assuming $70 WTI and that funds flow returns back to the sector within my lifetime. The market perceives it as a heavy oil producer and yet 37 per cent of its cash flow comes from the Eagleford Basin in Texas, which receives a $5 premium per barrel to WTI. At $70 WTI and a $25 WCS differential, the stock trades at three times enterprise value to cash flow (EV/CF) and a 26 per cent free cash flow yield, with a debt-to-cash-flow multiple of 1.7 times. Baytex is no longer the overleveraged heavy oil producer of years past. With excellent recent results from their East Duvernay play, investors also get free upside on 256 sections in the Pembina area, which offers another leg of growth to the story. These types of names used to trade at seven to eight times EV/CF. Assuming that lower multiples are the “new normal,” a five-times EV/CF multiple at $60 WTI equals to a $3.61 share price (46 per cent upside) or a $6.33 share price at $70 WTI (154 per cent upside). With the stock down by over 50 per cent in the past five months on macro volatility, we continue to be buyers of the stock at every opportunity we get.