Top Pick Tuesdays – Baytex Energy Corp.

Baytex Energy Corp. (BTE:NYSE)
Price at Preparation: $3.32 (Dec 29, 2023)

What they do

Baytex Energy Corp. (BTE:NYSE) is a Canadian-based energy company founded in 1993 and is headquartered in Calgary, Canada. The Company is engaged in the acquisition, development and production of crude oil and natural gas in the Western Canadian Sedimentary Basin and in the Eagle Ford in the United States. Its crude oil and natural gas operations are organized into three main operating areas: Light Oil USA (located in the core of the liquids-rich Eagle Ford shale in South Texas), Light Oil Canada (Pembina Duvernay / Viking) and Heavy Oil Canada (Peace River / Peavine / Lloydminster), located in Saskatchewan and Alberta.

From all of us at Theta Bandits, we wish you and your loved ones a great start to the New Year!! Now, let’s kick the year off with a bang and get right into our first Top Pick Tuesday of 2024.

This week, our focus is on Baytex Energy Corp (BTE:NYSE), a stock that has been beaten up recently due to circumstances like the market reaction to recent acquisitions, presenting us with a potential opportunity. As a Canadian mid-cap energy company with exposure in both US and Canadian markets offers us the chance for added leverage due to its more affordable stock price. Presently, at the time of creating this plan, the stock sits at $3.32, marking a 14% increase from its 52-week low of $2.89. However, the current average 12-month price target (PT) stands at an impressive $5.66 – a potential upside of a whopping 70% from the current price. Notably, all reporting analysts rate this stock as a buy or hold, with no sell ratings. Although the option activity lacks significant volume currently, keep a watchful eye on it as this could potentially change with price movements. Additionally, closely monitor spot oil prices, like WTI (West Texas Intermediate), which currently is approximately $72, as fluctuations could impact this stock’s price volatility.

Plan

As you’ve come to expect, refer to the visual roadmap included. This is not a trade with fancy footwork; rather, we’re starting the year with a straightforward buy, hold and plan your exits trade. As the diagram shows 2023 has been a year for increased volume on this stock. With this increased volume, we are betting on increased price volatility and gaining traction with current or higher spot oil prices leading to a push higher off support. It also outlines support / resistance lines where stop losses can be positioned once the price action crosses into the next zone. These lines are shown at $3.76, $4.10, $4.51, $5.00, $5.70 with our identified PT at $5.66. Anything above that last target zone resistance marks a nice bonus.

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RISKS

Trades do not always unfold flawlessly, making those protection lines to secure profits are pivotal. If we fall below the 52-week low of $2.89 signals a moment to revise the plan and at worst case exit the trade and focus on the next opportunity.

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Disclaimer: This article is for informational and educational purposes only, not investment advice. We recommend researching and consulting with a financial advisor before making investment decisions. All actions based on this information are at your own risk.

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