Intrinsic value of Baytex Energy - BTE

Previous Close

$2.49

  Intrinsic Value

$1.76

stock screener

  Rating & Target

sell

-29%

  Value-price divergence*

-37%

Previous close

$2.49

 
Intrinsic value

$1.76

 
Up/down potential

-29%

 
Rating

sell

 
Value-price divergence*

-37%

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of BTE stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.5

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -31.49
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  446
  714
  1,103
  1,649
  2,392
  3,375
  4,640
  6,228
  8,178
  10,524
  13,292
  16,506
  20,180
  24,324
  28,940
  34,029
  39,584
  45,597
  52,059
  58,960
  66,288
  74,035
  82,192
  90,754
  99,715
  109,076
  118,836
  129,001
  139,577
  150,573
  162,003
Variable operating expenses, $m
 
  1,785
  2,758
  4,125
  5,986
  8,445
  11,610
  15,584
  20,462
  26,330
  33,257
  41,298
  50,490
  60,858
  72,409
  85,140
  99,038
  114,083
  130,252
  147,517
  165,853
  185,236
  205,645
  227,066
  249,487
  272,907
  297,328
  322,760
  349,221
  376,734
  405,330
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  953
  1,785
  2,758
  4,125
  5,986
  8,445
  11,610
  15,584
  20,462
  26,330
  33,257
  41,298
  50,490
  60,858
  72,409
  85,140
  99,038
  114,083
  130,252
  147,517
  165,853
  185,236
  205,645
  227,066
  249,487
  272,907
  297,328
  322,760
  349,221
  376,734
  405,330
Operating income, $m
  -507
  -1,072
  -1,656
  -2,477
  -3,593
  -5,070
  -6,970
  -9,355
  -12,284
  -15,806
  -19,965
  -24,792
  -30,310
  -36,534
  -43,468
  -51,111
  -59,454
  -68,487
  -78,193
  -88,557
  -99,565
  -111,201
  -123,453
  -136,312
  -149,772
  -163,832
  -178,492
  -193,759
  -209,644
  -226,161
  -243,328
EBITDA, $m
  -131
  -547
  -845
  -1,263
  -1,833
  -2,585
  -3,554
  -4,771
  -6,265
  -8,061
  -10,182
  -12,643
  -15,458
  -18,632
  -22,168
  -26,066
  -30,321
  -34,927
  -39,877
  -45,163
  -50,777
  -56,711
  -62,959
  -69,517
  -76,382
  -83,552
  -91,028
  -98,815
  -106,916
  -115,339
  -124,094
Interest expense (income), $m
  77
  75
  143
  241
  378
  566
  813
  1,132
  1,532
  2,023
  2,614
  3,312
  4,121
  5,047
  6,091
  7,254
  8,536
  9,935
  11,450
  13,078
  14,816
  16,663
  18,614
  20,669
  22,826
  25,084
  27,442
  29,901
  32,461
  35,126
  37,896
Earnings before tax, $m
  -561
  -1,147
  -1,799
  -2,717
  -3,972
  -5,635
  -7,783
  -10,487
  -13,816
  -17,830
  -22,579
  -28,103
  -34,432
  -41,581
  -49,559
  -58,365
  -67,990
  -78,422
  -89,643
  -101,635
  -114,381
  -127,863
  -142,067
  -156,981
  -172,598
  -188,915
  -205,934
  -223,660
  -242,106
  -261,287
  -281,224
Tax expense, $m
  -202
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -359
  -1,147
  -1,799
  -2,717
  -3,972
  -5,635
  -7,783
  -10,487
  -13,816
  -17,830
  -22,579
  -28,103
  -34,432
  -41,581
  -49,559
  -58,365
  -67,990
  -78,422
  -89,643
  -101,635
  -114,381
  -127,863
  -142,067
  -156,981
  -172,598
  -188,915
  -205,934
  -223,660
  -242,106
  -261,287
  -281,224

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  2
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  3,400
  5,447
  8,416
  12,586
  18,262
  25,765
  35,421
  47,546
  62,430
  80,333
  101,467
  125,999
  154,045
  185,677
  220,919
  259,761
  302,164
  348,068
  397,398
  450,074
  506,016
  565,153
  627,422
  692,776
  761,185
  832,638
  907,146
  984,740
  1,065,471
  1,149,413
  1,236,660
Adjusted assets (=assets-cash), $m
  3,398
  5,447
  8,416
  12,586
  18,262
  25,765
  35,421
  47,546
  62,430
  80,333
  101,467
  125,999
  154,045
  185,677
  220,919
  259,761
  302,164
  348,068
  397,398
  450,074
  506,016
  565,153
  627,422
  692,776
  761,185
  832,638
  907,146
  984,740
  1,065,471
  1,149,413
  1,236,660
Revenue / Adjusted assets
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
  0.131
Average production assets, $m
  3,283
  5,252
  8,114
  12,135
  17,608
  24,842
  34,152
  45,842
  60,193
  77,454
  97,830
  121,483
  148,525
  179,022
  213,001
  250,451
  291,335
  335,593
  383,155
  433,943
  487,881
  544,898
  604,935
  667,947
  733,904
  802,796
  874,634
  949,447
  1,027,285
  1,108,218
  1,192,339
Working capital, $m
  -25
  -44
  -67
  -101
  -146
  -206
  -283
  -380
  -499
  -642
  -811
  -1,007
  -1,231
  -1,484
  -1,765
  -2,076
  -2,415
  -2,781
  -3,176
  -3,597
  -4,044
  -4,516
  -5,014
  -5,536
  -6,083
  -6,654
  -7,249
  -7,869
  -8,514
  -9,185
  -9,882
Total debt, $m
  1,298
  2,463
  4,152
  6,525
  9,754
  14,023
  19,518
  26,416
  34,886
  45,072
  57,098
  71,056
  87,015
  105,013
  125,066
  147,167
  171,295
  197,414
  225,482
  255,455
  287,286
  320,935
  356,366
  393,552
  432,477
  473,134
  515,529
  559,680
  605,616
  653,379
  703,023
Total liabilities, $m
  1,936
  3,100
  4,789
  7,162
  10,391
  14,660
  20,155
  27,053
  35,523
  45,709
  57,735
  71,693
  87,652
  105,650
  125,703
  147,804
  171,932
  198,051
  226,119
  256,092
  287,923
  321,572
  357,003
  394,189
  433,114
  473,771
  516,166
  560,317
  606,253
  654,016
  703,660
Total equity, $m
  1,465
  2,348
  3,627
  5,425
  7,871
  11,105
  15,267
  20,492
  26,907
  34,623
  43,732
  54,305
  66,394
  80,027
  95,216
  111,957
  130,233
  150,017
  171,278
  193,982
  218,093
  243,581
  270,419
  298,586
  328,071
  358,867
  390,980
  424,423
  459,218
  495,397
  533,001
Total liabilities and equity, $m
  3,401
  5,448
  8,416
  12,587
  18,262
  25,765
  35,422
  47,545
  62,430
  80,332
  101,467
  125,998
  154,046
  185,677
  220,919
  259,761
  302,165
  348,068
  397,397
  450,074
  506,016
  565,153
  627,422
  692,775
  761,185
  832,638
  907,146
  984,740
  1,065,471
  1,149,413
  1,236,661
Debt-to-equity ratio
  0.886
  1.050
  1.140
  1.200
  1.240
  1.260
  1.280
  1.290
  1.300
  1.300
  1.310
  1.310
  1.310
  1.310
  1.310
  1.310
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
  1.320
Adjusted equity ratio
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -359
  -1,147
  -1,799
  -2,717
  -3,972
  -5,635
  -7,783
  -10,487
  -13,816
  -17,830
  -22,579
  -28,103
  -34,432
  -41,581
  -49,559
  -58,365
  -67,990
  -78,422
  -89,643
  -101,635
  -114,381
  -127,863
  -142,067
  -156,981
  -172,598
  -188,915
  -205,934
  -223,660
  -242,106
  -261,287
  -281,224
Depreciation, amort., depletion, $m
  376
  525
  811
  1,214
  1,761
  2,484
  3,415
  4,584
  6,019
  7,745
  9,783
  12,148
  14,852
  17,902
  21,300
  25,045
  29,133
  33,559
  38,316
  43,394
  48,788
  54,490
  60,494
  66,795
  73,390
  80,280
  87,463
  94,945
  102,728
  110,822
  119,234
Funds from operations, $m
  535
  -622
  -987
  -1,504
  -2,211
  -3,151
  -4,368
  -5,903
  -7,797
  -10,084
  -12,796
  -15,955
  -19,579
  -23,679
  -28,259
  -33,320
  -38,857
  -44,862
  -51,327
  -58,241
  -65,593
  -73,373
  -81,574
  -90,186
  -99,208
  -108,636
  -118,470
  -128,715
  -139,377
  -150,465
  -161,990
Change in working capital, $m
  352
  -16
  -24
  -33
  -45
  -60
  -77
  -97
  -119
  -143
  -169
  -196
  -224
  -253
  -282
  -310
  -339
  -367
  -394
  -421
  -447
  -473
  -498
  -522
  -547
  -571
  -595
  -620
  -645
  -671
  -697
Cash from operations, $m
  183
  -606
  -964
  -1,470
  -2,166
  -3,091
  -4,291
  -5,806
  -7,678
  -9,941
  -12,627
  -15,759
  -19,355
  -23,426
  -27,977
  -33,009
  -38,518
  -44,495
  -50,933
  -57,820
  -65,146
  -72,901
  -81,076
  -89,664
  -98,661
  -108,065
  -117,875
  -128,095
  -138,732
  -149,794
  -161,293
Maintenance CAPEX, $m
  0
  -328
  -525
  -811
  -1,214
  -1,761
  -2,484
  -3,415
  -4,584
  -6,019
  -7,745
  -9,783
  -12,148
  -14,852
  -17,902
  -21,300
  -25,045
  -29,133
  -33,559
  -38,316
  -43,394
  -48,788
  -54,490
  -60,494
  -66,795
  -73,390
  -80,280
  -87,463
  -94,945
  -102,728
  -110,822
New CAPEX, $m
  -166
  -1,970
  -2,862
  -4,021
  -5,472
  -7,234
  -9,310
  -11,690
  -14,351
  -17,261
  -20,377
  -23,653
  -27,042
  -30,497
  -33,979
  -37,450
  -40,884
  -44,258
  -47,562
  -50,788
  -53,938
  -57,017
  -60,037
  -63,011
  -65,957
  -68,893
  -71,838
  -74,813
  -77,838
  -80,934
  -84,120
Cash from investing activities, $m
  -216
  -2,298
  -3,387
  -4,832
  -6,686
  -8,995
  -11,794
  -15,105
  -18,935
  -23,280
  -28,122
  -33,436
  -39,190
  -45,349
  -51,881
  -58,750
  -65,929
  -73,391
  -81,121
  -89,104
  -97,332
  -105,805
  -114,527
  -123,505
  -132,752
  -142,283
  -152,118
  -162,276
  -172,783
  -183,662
  -194,942
Free cash flow, $m
  -33
  -2,903
  -4,351
  -6,303
  -8,851
  -12,086
  -16,085
  -20,911
  -26,613
  -33,221
  -40,749
  -49,195
  -58,545
  -68,776
  -79,858
  -91,760
  -104,447
  -117,887
  -132,054
  -146,924
  -162,478
  -178,706
  -195,603
  -213,169
  -231,413
  -250,348
  -269,992
  -290,371
  -311,515
  -333,456
  -356,235
Issuance/(repayment) of debt, $m
  -45
  1,165
  1,689
  2,373
  3,230
  4,269
  5,494
  6,899
  8,469
  10,186
  12,025
  13,959
  15,959
  17,998
  20,053
  22,101
  24,128
  26,119
  28,069
  29,973
  31,831
  33,649
  35,431
  37,186
  38,925
  40,657
  42,395
  44,151
  45,936
  47,763
  49,644
Issuance/(repurchase) of shares, $m
  81
  2,032
  3,078
  4,515
  6,418
  8,869
  11,945
  15,713
  20,231
  25,546
  31,688
  38,677
  46,520
  55,214
  64,748
  75,106
  86,266
  98,206
  110,904
  124,339
  138,492
  153,351
  168,905
  185,149
  202,082
  219,712
  238,047
  257,103
  276,901
  297,466
  318,827
Cash from financing (excl. dividends), $m  
  36
  3,197
  4,767
  6,888
  9,648
  13,138
  17,439
  22,612
  28,700
  35,732
  43,713
  52,636
  62,479
  73,212
  84,801
  97,207
  110,394
  124,325
  138,973
  154,312
  170,323
  187,000
  204,336
  222,335
  241,007
  260,369
  280,442
  301,254
  322,837
  345,229
  368,471
Total cash flow (excl. dividends), $m
  2
  293
  416
  585
  796
  1,052
  1,354
  1,700
  2,088
  2,511
  2,964
  3,441
  3,933
  4,436
  4,943
  5,448
  5,947
  6,438
  6,918
  7,388
  7,846
  8,294
  8,733
  9,166
  9,594
  10,021
  10,450
  10,882
  11,322
  11,773
  12,236
Retained Cash Flow (-), $m
  322
  -2,032
  -3,078
  -4,515
  -6,418
  -8,869
  -11,945
  -15,713
  -20,231
  -25,546
  -31,688
  -38,677
  -46,520
  -55,214
  -64,748
  -75,106
  -86,266
  -98,206
  -110,904
  -124,339
  -138,492
  -153,351
  -168,905
  -185,149
  -202,082
  -219,712
  -238,047
  -257,103
  -276,901
  -297,466
  -318,827
Prev. year cash balance distribution, $m
 
  2
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -1,737
  -2,662
  -3,930
  -5,622
  -7,817
  -10,590
  -14,012
  -18,144
  -23,035
  -28,724
  -35,236
  -42,586
  -50,778
  -59,806
  -69,658
  -80,319
  -91,768
  -103,986
  -116,951
  -130,647
  -145,057
  -160,172
  -175,983
  -192,488
  -209,691
  -227,597
  -246,221
  -265,579
  -285,693
  -306,591
Discount rate, %
 
  9.50
  9.98
  10.47
  11.00
  11.55
  12.12
  12.73
  13.37
  14.04
  14.74
  15.47
  16.25
  17.06
  17.91
  18.81
  19.75
  20.74
  21.77
  22.86
  24.01
  25.21
  26.47
  27.79
  29.18
  30.64
  32.17
  33.78
  35.47
  37.24
  39.10
PV of cash for distribution, $m
 
  -1,586
  -2,201
  -2,915
  -3,704
  -4,526
  -5,330
  -6,056
  -6,650
  -7,063
  -7,264
  -7,238
  -6,993
  -6,551
  -5,955
  -5,251
  -4,492
  -3,727
  -2,999
  -2,339
  -1,767
  -1,292
  -914
  -625
  -413
  -263
  -161
  -95
  -54
  -29
  -15
Current shareholders' claim on cash, %
  100
  33.5
  11.7
  4.2
  1.6
  0.6
  0.2
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Baytex Energy Corp., an oil and gas company, engages in the acquisition, development, exploitation, and production of oil and natural gas in the Western Canadian Sedimentary Basin and the United States. It offers heavy oil, light oil, condensate, and natural gas liquids. The company was founded in 1993 and is headquartered in Calgary, Canada.

FINANCIAL RATIOS  of  Baytex Energy (BTE)

Valuation Ratios
P/E Ratio -1.6
Price to Sales 1.3
Price to Book 0.4
Price to Tangible Book
Price to Cash Flow 3.2
Price to Free Cash Flow 34.2
Growth Rates
Sales Growth Rate -31.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -57.1%
Cap. Spend. - 3 Yr. Gr. Rate -16.7%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 88.6%
Total Debt to Equity 88.6%
Interest Coverage -6
Management Effectiveness
Return On Assets -8.3%
Ret/ On Assets - 3 Yr. Avg. -66.2%
Return On Total Capital -12.1%
Ret/ On T. Cap. - 3 Yr. Avg. -14%
Return On Equity -22.1%
Return On Equity - 3 Yr. Avg. -25.2%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 59.9%
Gross Margin - 3 Yr. Avg. 66.8%
EBITDA Margin -24.2%
EBITDA Margin - 3 Yr. Avg. -22.2%
Operating Margin -113.7%
Oper. Margin - 3 Yr. Avg. -90.2%
Pre-Tax Margin -125.8%
Pre-Tax Margin - 3 Yr. Avg. -98.3%
Net Profit Margin -80.5%
Net Profit Margin - 3 Yr. Avg. -73%
Effective Tax Rate 36%
Eff/ Tax Rate - 3 Yr. Avg. 3319.7%
Payout Ratio 0%

BTE stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BTE stock intrinsic value calculation we used $446 million for the last fiscal year's total revenue generated by Baytex Energy. The default revenue input number comes from 2016 income statement of Baytex Energy. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our BTE stock valuation model: a) initial revenue growth rate of 60% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 9.5%, whose default value for BTE is calculated based on our internal credit rating of Baytex Energy, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Baytex Energy.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of BTE stock the variable cost ratio is equal to 250.2%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for BTE stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.8% for Baytex Energy.

Corporate tax rate of 27% is the nominal tax rate for Baytex Energy. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the BTE stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for BTE are equal to 736%.

Life of production assets of 10 years is the average useful life of capital assets used in Baytex Energy operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for BTE is equal to -6.1%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $1465 million for Baytex Energy - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 207.959 million for Baytex Energy is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Baytex Energy at the current share price and the inputted number of shares is $0.5 billion.

RELATED COMPANIES Price Int.Val. Rating
MRO Marathon Oil 11.19 5.09  str.sell

COMPANY NEWS

▶ Baytex posts 2Q profit   [Aug-01-17 10:58PM  Associated Press]
▶ Can Baytex Energy Corp Weather Another Market Downturn?   [Jun-15-17 01:30PM  Motley Fool]
▶ International Moat Index: France Impacted Its Performance   [May-31-17 10:48AM  Market Realist]
▶ ETFs with exposure to Baytex Energy Corp. : May 22, 2017   [May-22-17 01:25PM  Capital Cube]
▶ ETFs with exposure to Baytex Energy Corp. : May 11, 2017   [May-11-17 04:17PM  Capital Cube]
▶ Baytex posts 1Q profit   [May-04-17 07:49PM  Associated Press]
▶ Baytex Q1 2017 Production Increases 6%   [04:30PM  GlobeNewswire]
▶ 4 Oil Stocks Id Avoid at All Costs   [Apr-29-17 05:00PM  Motley Fool]
▶ ETFs with exposure to Baytex Energy Corp. : April 5, 2017   [Apr-05-17 04:26PM  Capital Cube]
▶ Baytex Energy Files 2016 Year-End Disclosure Documents   [Mar-07-17 06:13PM  Marketwired]
▶ Baytex reports 4Q loss   [08:01AM  Associated Press]
▶ 2 Stocks to Avoid (and 1 to Buy)   [Feb-21-17 04:07PM  Motley Fool]
▶ Baytex to Present at CIBC Whistler Conference   [Jan-23-17 05:15PM  Marketwired]
▶ Baytex Announces Closing of Peace River Acquisition   [Jan-20-17 05:08PM  Marketwired]
▶ Was Baytex Energy Corp's Fantastic Run in 2016 Too Much?   [Jan-17-17 01:27PM  at Motley Fool]
▶ Is Baytex Energy Corp (USA) (BTE) Worthy of Your Portfolio?   [Dec-14-16 03:05AM  at Insider Monkey]
▶ Why Baytex Energy, Akorn, and Alamos Gold Jumped Today   [Dec-12-16 05:52PM  at Motley Fool]
▶ Why Canadian Oil Stocks Blasted Off Today   [Nov-30-16 04:08PM  at Motley Fool]
▶ Baytex Bets on Oil Recovery (BTE)   [Nov-29-16 08:45AM  at Investopedia]
▶ Is Wix.Com Ltd (WIX) A Good Stock to Buy?   [Nov-28-16 10:15AM  at Insider Monkey]
▶ Baytex Energy Corp. Goes Shopping   [Nov-23-16 04:48PM  at Motley Fool]
▶ Will Trump Be Good for Baytex Energy? (BTE)   [Nov-14-16 08:48AM  at Investopedia]
▶ Baytex Q3 Earnings Report: Hits and Misses (BTE)   [Nov-04-16 06:33PM  at Investopedia]
▶ Baytex Reports Q3 2016 Results   [07:30AM  Marketwired]
▶ These 3 Oil Stocks Aren't Out of the Woods Just Yet   [Oct-26-16 05:15PM  at Motley Fool]
▶ Baytex Blames Blast on Poor Regulator Standards (BTE)   [Oct-24-16 04:05PM  at Investopedia]
▶ Baytex Short Interest Surges in September (BTE)   [Oct-20-16 03:53PM  at Investopedia]
▶ How Bad Is Baytex Debt? (BTE)   [Oct-14-16 08:04AM  at Investopedia]
▶ Is the Worst Over for Oil Stocks?   [Sep-08-16 03:30PM  at Motley Fool]
▶ Baytex to Present at Peters & Co. Energy Conference   [Sep-07-16 05:15PM  Marketwired]
▶ Baytex Announces Executive Appointment   [Jul-13-16 05:00PM  Marketwired]
▶ 3 Oil Stocks That Could Rocket if Crude Keeps Rising   [Jul-02-16 04:00PM  at Motley Fool]
▶ Baytex Provides Update on Tax Reassessment   [Jun-22-16 05:00PM  Marketwired]
▶ Oil & Gas Stock Roundup: $50 Oil Fuels Massive Gains   [Jun-11-16 11:00AM  at Motley Fool]
▶ 5 stocks to watch   [Jun-08-16 02:47PM  at MarketWatch]
Stock chart of BTE Financial statements of BTE
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

FREE DOWNLOAD
Follow us on:   twitter   twitter   twitter   twitter

VALUATION THEORY       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2017. All rigths reserved.