Rotten Tomato Stocks
No Result
View All Result
  • News
    US Stocks Slip, on Track for 4th Monthly Loss This Year

    US Stocks Slip, on Track for 4th Monthly Loss This Year

    US Consumer Confidence Slumps to Lowest Level in 16 Months

    US Consumer Confidence Slumps to Lowest Level in 16 Months

    U.S. stock indexes book biggest daily drop in over a week despite strong economic data

    U.S. stock indexes book biggest daily drop in over a week despite strong economic data

    Panera Bread Product Recalled

    Panera Bread Product Recalled

  • NYSE
    Thor Industries Shares Decline 2.7% After Expectations of Muted Short-Term Demand

    Thor Industries Shares Decline 2.7% After Expectations of Muted Short-Term Demand

    Hanesbrands Inc. stock falls Wednesday, underperforms market

    Hanesbrands Inc. stock falls Wednesday, underperforms market

    Digital Realty Trust (NYSE:DLR) Shares Down 7.3% on Insider Selling

    Digital Realty Trust (NYSE:DLR) Shares Down 7.3% on Insider Selling

    NIO shares extend losses as Chinese EV maker denies short-seller report

    NIO shares extend losses as Chinese EV maker denies short-seller report

  • NASDAQ
    Duck Creek Tech Shares Decline 12% on Wider 3Q Loss, Lower FY22 Rev View

    Duck Creek Tech Shares Decline 12% on Wider 3Q Loss, Lower FY22 Rev View

    Plug Power Inc. stock falls Wednesday, underperforms market

    Plug Power Inc. stock falls Wednesday, underperforms market

    Nova (NASDAQ:NVMI) Hits New 52-Week Low on Analyst Downgrade

    Nova (NASDAQ:NVMI) Hits New 52-Week Low on Analyst Downgrade

    Tesla stock lower ahead of second-quarter sales

    Tesla stock lower ahead of second-quarter sales

  • OTC
    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    Corus Entertainment 4Q Profit Falls

    Corus Entertainment 4Q Profit Falls

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

  • TSX
    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    Bitcoin Is Falling: Should You Buy the Dip?

    Bitcoin Is Falling: Should You Buy the Dip?

    CN Rail Stock Is So Undervalued That it’s Absurd

    CN Rail Stock Is So Undervalued That it’s Absurd

  • News
    US Stocks Slip, on Track for 4th Monthly Loss This Year

    US Stocks Slip, on Track for 4th Monthly Loss This Year

    US Consumer Confidence Slumps to Lowest Level in 16 Months

    US Consumer Confidence Slumps to Lowest Level in 16 Months

    U.S. stock indexes book biggest daily drop in over a week despite strong economic data

    U.S. stock indexes book biggest daily drop in over a week despite strong economic data

    Panera Bread Product Recalled

    Panera Bread Product Recalled

  • NYSE
    Thor Industries Shares Decline 2.7% After Expectations of Muted Short-Term Demand

    Thor Industries Shares Decline 2.7% After Expectations of Muted Short-Term Demand

    Hanesbrands Inc. stock falls Wednesday, underperforms market

    Hanesbrands Inc. stock falls Wednesday, underperforms market

    Digital Realty Trust (NYSE:DLR) Shares Down 7.3% on Insider Selling

    Digital Realty Trust (NYSE:DLR) Shares Down 7.3% on Insider Selling

    NIO shares extend losses as Chinese EV maker denies short-seller report

    NIO shares extend losses as Chinese EV maker denies short-seller report

  • NASDAQ
    Duck Creek Tech Shares Decline 12% on Wider 3Q Loss, Lower FY22 Rev View

    Duck Creek Tech Shares Decline 12% on Wider 3Q Loss, Lower FY22 Rev View

    Plug Power Inc. stock falls Wednesday, underperforms market

    Plug Power Inc. stock falls Wednesday, underperforms market

    Nova (NASDAQ:NVMI) Hits New 52-Week Low on Analyst Downgrade

    Nova (NASDAQ:NVMI) Hits New 52-Week Low on Analyst Downgrade

    Tesla stock lower ahead of second-quarter sales

    Tesla stock lower ahead of second-quarter sales

  • OTC
    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    China Eastern Airlines 3Q Loss Widens on Low Travel Demand

    Corus Entertainment 4Q Profit Falls

    Corus Entertainment 4Q Profit Falls

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Nintendo Co. Ltd. ADR falls Monday, still outperforms market

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

    Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

  • TSX
    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

    Bitcoin Is Falling: Should You Buy the Dip?

    Bitcoin Is Falling: Should You Buy the Dip?

    CN Rail Stock Is So Undervalued That it’s Absurd

    CN Rail Stock Is So Undervalued That it’s Absurd

No Result
View All Result
Rotten Tomato Stocks
No Result
View All Result

Is Baytex Energy (TSE:BTE) Weighed On By Its Debt Load?

Editorial Staff by Editorial Staff
April 17, 2021
0
Is Baytex Energy (TSE:BTE) Weighed On By Its Debt Load?

Warren Buffett famously said, ‘Volatility is far from synonymous with risk.’ So it might be obvious that you need to consider debt, when you think about how risky any given stock is, because too much debt can sink a company. We note that Baytex Energy Corp. (TSE:BTE) does have debt on its balance sheet. But should shareholders be worried about its use of debt?

When Is Debt Dangerous?

Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. Ultimately, if the company can’t fulfill its legal obligations to repay debt, shareholders could walk away with nothing. However, a more usual (but still expensive) situation is where a company must dilute shareholders at a cheap share price simply to get debt under control. By replacing dilution, though, debt can be an extremely good tool for businesses that need capital to invest in growth at high rates of return. When we examine debt levels, we first consider both cash and debt levels, together.

How Much Debt Does Baytex Energy Carry?

As you can see below, Baytex Energy had CA$1.78b of debt, at December 2020, which is about the same as the year before. You can click the chart for greater detail. Net debt is about the same, since the it doesn’t have much cash.

debt-equity-history-analysis
TSX:BTE Debt to Equity History April 4th 2021

How Strong Is Baytex Energy’s Balance Sheet?

We can see from the most recent balance sheet that Baytex Energy had liabilities of CA$198.9m falling due within a year, and liabilities of CA$2.63b due beyond that. On the other hand, it had cash of CA$5.57m and CA$107.5m worth of receivables due within a year. So its liabilities outweigh the sum of its cash and (near-term) receivables by CA$2.72b.

This deficit casts a shadow over the CA$784.1m company, like a colossus towering over mere mortals. So we’d watch its balance sheet closely, without a doubt. At the end of the day, Baytex Energy would probably need a major re-capitalization if its creditors were to demand repayment. The balance sheet is clearly the area to focus on when you are analysing debt. But it is future earnings, more than anything, that will determine Baytex Energy’s ability to maintain a healthy balance sheet going forward.

Over 12 months, Baytex Energy made a loss at the EBIT level, and saw its revenue drop to CA$812m, which is a fall of 45%. That makes us nervous, to say the least.

Caveat Emptor

Not only did Baytex Energy’s revenue slip over the last twelve months, but it also produced negative earnings before interest and tax (EBIT). Its EBIT loss was a whopping CA$2.5b. Combining this information with the significant liabilities we already touched on makes us very hesitant about this stock, to say the least. That said, it is possible that the company will turn its fortunes around. But we think that is unlikely since it is low on liquid assets, and made a loss of CA$2.4b in the last year. So while it’s not wise to assume the company will fail, we do think it’s risky. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately, every company can contain risks that exist outside of the balance sheet.

Related Posts

US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds
TSX

US Seeks to Fine Air Canada $25.5 Million Over Slow Refunds

June 17, 2021
S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US
TSX

S&P/TSX composite falls on drop in materials sector, loonie tops 81 cents US

May 3, 2021
Bitcoin Is Falling: Should You Buy the Dip?
TSX

Bitcoin Is Falling: Should You Buy the Dip?

May 3, 2021
CN Rail Stock Is So Undervalued That it’s Absurd
TSX

CN Rail Stock Is So Undervalued That it’s Absurd

May 2, 2021
Load More
Next Post
Is Aura Minerals (TSE:ORA) A Risky Investment?

Is Aura Minerals (TSE:ORA) A Risky Investment?

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

POPULAR NEWS

CNH Industrial (NYSE:CNHI) Use Of Debt Could Be Considered Risky

CNH Industrial (NYSE:CNHI) Use Of Debt Could Be Considered Risky

April 14, 2021
10 Warning Signs That Should Tell You “This Stock is in Trouble”

10 Warning Signs That Should Tell You “This Stock is in Trouble”

November 11, 2019
Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

Ocado Group PLC Revenue of Ocado Retail in Q3 Fell 10.6%

September 14, 2021
CN Rail Stock Is So Undervalued That it’s Absurd

CN Rail Stock Is So Undervalued That it’s Absurd

May 2, 2021
Bitcoin Is Falling: Should You Buy the Dip?

Bitcoin Is Falling: Should You Buy the Dip?

May 3, 2021

EDITOR'S PICK

Stocks That Hit 52-Week Lows On Monday

Stocks That Hit 52-Week Lows On Monday

December 25, 2019
An Intrinsic Calculation For ConocoPhillips Company (NYSE:COP) Suggests It’s 23% Undervalued

An Intrinsic Calculation For ConocoPhillips Company (NYSE:COP) Suggests It’s 23% Undervalued

December 25, 2019
Is a Stock Market Crash Likely? These 5 Metrics Say So

Is a Stock Market Crash Likely? These 5 Metrics Say So

April 25, 2021
Personal Income Declined in May

Personal Income Declined in May

June 25, 2021

Stay Updated

Get breaking news delivered straight into your inbox

Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. Rotten Tomato stocks is a wholly-owned subsidiary of Grainne Capital Limited.
While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.

Rotten Tomato Stocks cover the companies and markets that are declining, failing or headed for disaster. We help investors spot the down tends and recognize when something smells rotten.

RECENT POSTS

US Stocks Slip, on Track for 4th Monthly Loss This Year

Thor Industries Shares Decline 2.7% After Expectations of Muted Short-Term Demand

Hanesbrands Inc. stock falls Wednesday, underperforms market

POPULAR POSTS

Digital Realty Trust (NYSE:DLR) Shares Down 7.3% on Insider Selling

Duck Creek Tech Shares Decline 12% on Wider 3Q Loss, Lower FY22 Rev View

Plug Power Inc. stock falls Wednesday, underperforms market

© Copyright 2021 RottenTomatoStocks. All Rights Reserved 

Disclaimer | Privacy Policy

No Result
View All Result
  • HOME
  • NEWS
  • NYSE
  • NASDAQ
  • OTC
  • TSX

© 2021 RottenTomatoStocks.com

error: Content is protected !!
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.