Baytex Energy Corp (BTE.TO)

This is definitely a Sell or Avoid. It basically tracks the price of oil, and there is no recovery. Sellers are still willing to accept low prices and keep selling. No new or strong buyers have stepped up.

Doesn’t think this is in danger in the short term. They have a lot of debt, but a lot of it is term debt. Also, have had some bank lines that they have securitized against their assets, which gets them in line with the bank covenants. They have bought themselves a lot of time. She likes their Canadian assets. A “wait and see” story.

He wants to like it because he likes the Texas assets. The issue is that it does not work at these oil prices. He used to own it and then exited the traded. If you are bullish on oil it is a great name to buy. This would be the first name he would buy if oil went up.

In the 2^nd quarter, they harvested a lot of their hedge book. At the end of 2015, they had $106 million, and are now down to $24 million. A big portion of their cash flow came from their hedge book. They now have losses on some of their hedges on their books. His big problem is that they have $1.9 billion of debt, ($8.83 a share), with a BV of $2.1 billion ($10.33 a share). Volumes are coming down.

He loved this earlier this year. He liked that it had no debt maturities coming until 2021, so the balance sheet was a lot stronger than people had thought. However, that trade has kind of played itself out. He would love to own this in the $5 space.

This has a fairly high debt level. Overall it is a pretty good company, but there has been a lot of volatility in the oil complex, particularly of late. Oil prices are not supportive of higher oil prices.

Bought a little of this recently when it got knocked back. One of the better managed oil/gas companies, mainly on heavy oil in Canada and light oil in Texas. They have a balance sheet that is under control. Fixed their lines of credit, so they are basically operating on a positive cash flow basis. He likes that they have some really good Texas shale properties. Once we see oil back in the $50-$60 range, those wells can be completed.

This is a call on oil. You need to be quite optimistic on oil prices for this company to make money. It is considered a high beta stock, because it has more debt than most of the others. It also has some higher cost heavy oil properties in Alberta that are not making very much money right now, but could do well if oil goes back to $100.

It is a company he likes. It is a buy below $6 and a sell in the high $6s to low $7s. His preference is Enerplus Corp (ERF-T) where he gets more exposure to nat gas.

This is the most leveraged to the pure oil price. If we had a real rally in oil prices, into the $60-$70 range, this stock would be going to $15. However, if it gets in trouble and if oil goes the other way, he owns the bonds instead.

Had a good run this year and is up about 60%, but is down 80% from its highs. Hasn’t owned it for probably 3 years. Not the kind of thing he will be buying in the future.

(A Top Pick Aug 18/15. Up 13.69%.) *Short* It had been a pretty good trade for a while. He closed it off and actually went Long for a while, and then just sold out of it entirely. The company had an inordinately high level of debt and did things like suspending the dividend and a few other things, but they are still offside. It really just comes down to a bet on the commodity. Although oil is going to march higher, it is going to be range bound for a while.

Doesn’t have a great balance sheet, although it has fixed a fair bit of it. Extremely levered to price, because it is heavy blends of oil. If you think oil is going to $60, this is still a buy and it will go to $10. Because of the volatility it gives you chances to buy when oil is down. This is going to move a lot.

Had recommended this the last time he was on, and it is now up about 10%. Still sees upside. The Canadian energy sector has its problems, but he sees the problems more in the conventional oil wells and oil sands. This company has a high viscosity, but pumpable heavy oil where there is quite good market. They got themselves into a bit of a debt squeeze by buying into the Texas shales. They have a good position there, so if anybody comes back on stream in the next little while, that is where it will be. Anything over $45-$50 and they can make money. This has some real potential, and he believes the price of oil is going to drift up into the $50 range.

Had been one of the higher dividend paying stocks, but slashed their dividends like the others. Had a bit of a debt issue when they paid top price for an acquisition a few years ago. Prefers Husky (HSE-T).