Should Value Investors Buy Baytex Energy (BTEGF) Stock?

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Baytex Energy (BTEGF). BTEGF is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 4.47. This compares to its industry's average Forward P/E of 4.91. Over the past 52 weeks, BTEGF's Forward P/E has been as high as 9.13 and as low as 2, with a median of 6.46.

Another valuation metric that we should highlight is BTEGF's P/B ratio of 1.38. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.51. BTEGF's P/B has been as high as 2.28 and as low as 0.99, with a median of 1.41, over the past year.

Finally, investors should note that BTEGF has a P/CF ratio of 1.38. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. BTEGF's current P/CF looks attractive when compared to its industry's average P/CF of 3.62. Over the past 52 weeks, BTEGF's P/CF has been as high as 2.29 and as low as 1.07, with a median of 1.42.

Another great Oil and Gas - Exploration and Production - Canadian stock you could consider is Crescent Point Energy (CPG), which is a # 1 (Strong Buy) stock with a Value Score of A.

Additionally, Crescent Point Energy has a P/B ratio of 0.75 while its industry's price-to-book ratio sits at 1.51. For CPG, this valuation metric has been as high as 1.21, as low as 0.41, with a median of 0.73 over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Baytex Energy and Crescent Point Energy are likely undervalued currently. And when considering the strength of its earnings outlook, BTEGF and CPG sticks out as one of the market's strongest value stocks.

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Baytex Energy Corp (BTEGF) : Free Stock Analysis Report
 
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